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12 April 2018
United States Files Complaint Seeking Forfeiture of Oil Painting Recovered by FBI Nearly 30 Years After Its Theft in New YorkRead the Press Release
WASHINGTON – The United States has filed a civil complaint seeking the forfeiture of an oil painting by Marc Chagall that was recovered by the FBI decades after it was stolen from collectors in New York. The United States intends to return the artwork to its rightful owners.
The announcement was made by U.S. Attorney for the District of Columbia Jessie K. Liu and Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office.
The artwork, “Othello and Desdemona,” is an oil painting on canvas created by Chagall in 1911, in the early stages of his career. It depicts a male, Othello, in the left foreground holding a sword in his hand and looking at a female figure, Desdemona, lying on a bed in the right background. It now is in the possession of the FBI and is currently being held at an FBI facility in Washington, D.C. This piece was previously displayed at an art gallery in Switzerland in the 1960s.
The complaint was filed in the U.S. District Court for the District of Columbia and seeks forfeiture of the painting on the basis that it represents the proceeds of the interstate transportation of stolen property and possession of stolen goods.
“For nearly 30 years, this magnificent painting was in the control of people who had no legal right to it,” said U.S. Attorney Liu. “It was stolen from New York collectors who had owned it since the 1920s, and they never saw it again. Now, thanks to the tireless efforts of the FBI, it has been located and will be returned to the collectors’ estate. This case shows that law enforcement will never stop its dogged pursuit of justice, and will do all it can to recover stolen treasures.”
“As the FBI returns this painting to the estate of its proper owners, we do so with the purpose of preserving history,” said Assistant Director in Charge McNamara. “This piece of artwork is of significance not just for its monetary value, but for its place in the world of art and culture. The FBI continues to commit investigative resources to recover cultural property.”
According to the complaint, the painting had been rightfully owned by Ernest and Rose Heller, art collectors who lived in New York. The Hellers, who are now deceased, had amassed a collection of artwork from their travels in Europe and other parts of the world. By 1988, they had collected more than 20 paintings and 12 sculptures, which they kept in their apartment.
In August of 1988, they came home to their apartment and discovered that the painting, along with other artwork and sculptures, had been stolen. The piece by Chagall had a label indicating that its owners were “Mr. + Mrs. E.S. Heller, New York.” The property was insured by an insurance company, which paid the Hellers a lump sum following the theft.
Following the burglary, Interpol listed the Chagall painting as a stolen artwork. An FBI investigation revealed that the painting was stolen from the apartment by an individual who worked in the building. That individual was convicted in a federal district court of interstate transportation of stolen property and mail fraud related to the theft and sale of other works of art stolen from other apartment buildings. Prior to the arrest of this individual, he attempted to sell the painting to a third party. That third party took the painting from the suspected thief in the late 1980s or early 1990s.
After that, this third party attempted to consign the painting to an art gallery in Washington, D.C., but without proof of ownership, the gallery refused to accept the painting. The gallery suggested that the individual contact law enforcement, which resulted in the FBI obtaining custody of the painting.
Upon completion of the forfeiture proceedings, the painting will be returned to the Rose Heller estate. At that time, and in consultation with the insurer’s representative, Art Recovery International, the painting will be sold at auction. The Heller estate will repay the insurance company for their disbursement from the proceeds of the sale, pay any related legal expenses, and donate the remainder of the sale proceeds to the estate’s beneficiaries: the McDowell Colony, a haven for artists in New Hampshire (80%), Columbia University (10%), and NYU Medical Center (10%), all 501(c)(3) tax-exempt non-profit corporations.
In a news article that appeared days after the theft, Ernest Heller was quoted as saying that he especially liked the Chagall. “It’s all in the hands of the police,” Mr. Heller said at the time. “Sometimes they’re (stolen paintings) returned but I doubt it.”
Christopher A. Marinello, CEO of Art Recovery International, the firm that is working with the insurer, issued a statement saying, “We are extremely grateful to the FBI and the U.S. Attorney’s Office for doggedly pursuing this case 30 years after the theft. This sends a resounding message to art thieves everywhere that in the U.S.A., the passage of time will not defeat the original owner’s right to bring a claim in recovery.”
The lawsuit is captioned United States v. One Oil Painting Entitled Othello and Desdemona by Marc Chagall. The claims made in the complaint are only allegations and do not constitute a determination of liability.
This case is being investigated by the FBI’s Washington Field Office. Assistant U.S. Attorneys Zia M. Faruqui, Brian P. Hudak, and Anthony Scarpelli, Special Assistant U.S. Attorney Sean Welsh, and Paralegal Specialist Toni Anne Donato, all from the U.S. Attorney’s Office for the District of Columbia, are representing the government.
Union County, New Jersey, Man Sentenced to 115 Months in Prison for Robbing Four BanksRead the Press Release
NEWARK, N.J. – An Elizabeth, New Jersey, man was sentenced today to 115 months in prison for robbing four banks in January 2017, including a TD Bank in Bergen County, New Jersey, U.S. Attorney Craig Carpenito announced.
Israel Cosme, 36, previously pleaded guilty before U.S. District Judge Esther Salas to an information charging him with four counts of bank robbery. Judge Salas imposed the sentence today in Newark federal court. Cosme was originally arrested Jan. 24, 2017 in connection with two of the bank robberies committed in Maryland.According to documents filed in this case and statements made in court:
Cosme admitted that on Jan. 15, 2017, he robbed a TD Bank in Little Ferry, New Jersey. During the robbery, Cosme verbally demanded money and told a teller that he would shoot her if she didn’t comply.
Cosme also admitted robbing a TD Bank in New York on Jan. 12, 2017; a TD Bank in Essex, Maryland, on Jan. 22, 2017; and a TD Bank in Baltimore, Maryland, on Jan. 23, 2017. During all three of these robberies, Cosme handed tellers a note demanding money and stating that he had a gun.
In addition to the prison term, Judge Salas sentenced Cosme to three years of supervised release.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Acting Special Agent in Charge Bradley W. Cohen in Newark, with the investigation. He also thanked the Little Ferry Police Department, under the direction of Chief Ralph Verdi, for its assistance.The government is represented by Assistant U.S. Attorney Jason S. Gould of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: K. Anthony Thomas Esq., Assistant Federal Public Defender, Newark
U.S. Attorney’s Office Observes National Crime Victims’ Rights Week with Events, including Resource Fair to Honor Victims & SurvivorsRead the Press Release
LOS ANGELES – In observance of National Crime Victims’ Rights Week, the United States Attorney’s Office has hosted a presentation and resource fair to honor victims and survivors. The office also conducted a Victim Service Awards ceremony to honor law enforcement personnel who have provided the highest level of assistance to victims and survivors of crime.
Each year in April, the Department of Justice observes National Crime Victims’ Rights Week to honor victims of crime and those who advocate on their behalf. The theme this year is “Expand the Circle: Reach All Victims.” President Trump proclaimed April 8 through 14, 2018, as National Crime Victims’ Rights Week.
The United States Attorney’s office, in partnership with Mount Saint Mary’s University, on Tuesday evening hosted a victim rights presentation and a resource fair with the goal of ensuring that every crime victim has access to services and support. The event honored victims and their advocates, and highlighted services available to victims of crime.
United States Attorney Nicola T. Hanna was joined at Tuesday’s event by representatives from the Federal Bureau of Investigation, the Los Angeles District Attorney’s Office, the Los Angeles City Attorney’s Office, the Los Angeles Police Department, and non-profit victim support service organizations. The Pet Prescription Team made a presentation on how therapy dogs can provide vital support to crime victims. The speakers emphasized how law enforcement, mental health professionals, community-based organizations and local residents can work in tandem to support crime victims.
“The United States Attorney’s Office is committed to serving and protecting victims – no matter the type of crime that has affected them,” said United States Attorney Nicola T. Hanna. “Whether the victim has suffered physical, financial or emotional trauma, our staff practices a victim-centered approach that assures victims’ rights are protected and all available services are provided.”
Tuesday night’s event at Mount Saint Mary’s University’s Doheny campus also included representatives from the Coalition to Abolish Slavery & Trafficking; the National Center for Missing and Exploited Children; the Los Angeles Mayor’s Office, Crisis Response Team (CRT); Strength United; the YWCA of Los Angeles; and the Los Angeles LGBTQ Center.
In another event this week, the United States Attorney’s Office held its annual Victim Service Awards ceremony on Wednesday to honor local and federal law enforcement agents and prosecutors who consistently strive to provide a focused, victim-centered approach to supporting victims of crime and next of kin on cases handled by the office.
The Department of Justice’s Office for Victims of Crime, within the Office of Justice Programs, leads communities across the country in observing National Crime Victims’ Rights Week each year. President Ronald Reagan proclaimed the first National Crime Victims’ Rights Week in 1981 to bring greater sensitivity to the needs and rights of victims of crime.
The Victim Witness Assistance Program of the United States Attorney’s Office provides a variety of services and assistance to victims and witnesses. Further information about the local program can be found on its website or by calling (888) 228-0315.
U.S. Attorney applauds Justice Department’s nationwide initiative to combat sexual harassment in housingRead the Press Release
WHEELING — Today, as the Department of Justice recognizes the 50th Anniversary of the Fair Housing Act, Attorney General Jeff Sessions announced the nationwide rollout of an initiative aimed at increasing awareness and reporting of sexual harassment in housing. The announcement includes an interagency task force between the Department of Housing and Urban Development (HUD) and the Justice Department to combat sexual harassment in housing, an outreach toolkit, and a public awareness campaign. This three-pronged approach will strengthen the Department’s efforts to combat sexual harassment in housing.
U.S. Attorney Bill Powell is applauding this increase of awareness, as sexual harassment in the housing market has been an issue in the Northern District of West Virginia.
“Sexual harassment cannot be tolerated anywhere anytime. It is especially heinous when it happens in someone’s own home, a place where everyone deserves to feel the most protected and safe. This office has made it clear that sexual harassment in the housing industry will be prosecuted. This initiative will make clear to landlords and their employees that this type of behavior is unacceptable and that consequences will follow,” said U.S. Attorney Bill Powell, the Northern District of West Virginia.
“Sexual harassment in housing is illegal, immoral, and unacceptable," said Attorney General Sessions. “It is all too common today, as too many landlords, managers, and their employees attempt to prey on vulnerable women. We will not hesitate to pursue these predators and enforce the law. In October, I ordered a new initiative to bring more of these cases, and we have already won relief for 15 victims. Today we announce three new steps to make the initiative more effective and to win more cases. I want to thank the dedicated and committed professionals in our Civil Rights Division and our partners in the Department of Housing and Urban Development for their hard work in this effort. We will continue to aggressively pursue harassers, because everyone has a right to be safe in their home.”“All discrimination stains the very fabric of our nation, but HUD is especially focused on protecting the right of everyone to feel safe and secure in their homes, free from unwanted sexual harassment,” said Secretary Ben Carson. “No person should have to tolerate unwanted sexual advances in order to keep a roof over his or her head. Part of our mission at HUD is to provide safe housing and we will remain diligent in this mission to protect those we serve. I look forward to working with Attorney General Sessions and the Department of Justice as part of this task force to bring an end to this type of discrimination.”
In October 2017, the Justice Department announced an initiative to combat sexual harassment in housing and launched pilot programs in D.C. and the Western District of Virginia. The initiative sought to increase the Department’s efforts to protect women from harassment by landlords, property managers, maintenance workers, security guards, and other employees and representatives of rental property owners. During the pilots, the Department developed and tested ways to better connect both with victims of sexual harassment in housing and with those organizations that victims may turn to first for help – including law enforcement, legal services providers, public housing authorities, sexual assault services providers, and shelters. The Department also tested certain aspects of the initiative in other jurisdictions, including New Jersey, the Central District of California, Massachusetts, Vermont, and Michigan.
The two pilot programs generated an upswing in harassment reporting to the Department from both D.C. and the Western District of Virginia. In D.C., the Department generated six leads since the October 2017 launch. In Virginia, the Department generated three leads. While the Justice Department recognizes that leads and investigations do not always lead to enforcement actions, the pilot program’s results—when extrapolated across all the U.S. Attorney’s Offices across the country—could lead to hundreds of new reports of sexual harassment in housing across the country.
Because of these promising results, the Department is rolling out three major components to the Initiative.
First, the new HUD-DOJ Task Force to Combat Sexual Harassment in Housing will drive a shared strategy between the Department and HUD for combatting sexual harassment in housing across the country. It will focus on five key areas: continued data sharing and analysis, joint development of training, evaluation of public housing complaint mechanisms, coordination of public outreach and press strategy, and review of federal policies.
Second, the outreach toolkit is designed to leverage the Justice Department’s nationwide network of U.S. Attorney’s Offices. The toolkit provides templates, guidance, and checklists based on pilot program feedback. It ultimately will amplify available enforcement resources and help victims of sexual harassment connect with the Department.
Third, the public awareness campaign has three major components: a partnership package with relevant stakeholders, launch of a social media campaign, and Public Service Announcements (PSAs) run by individual U.S. Attorney’s offices. The campaign is specifically designed to raise awareness, and make it easier for victims all over the country to find resources and report harassment.
More information about the Civil Rights Division and the civil rights laws it enforces is available at www.usdoj.gov/crt. Individuals who believe that they may have been victims of sexual harassment in housing should call the Department at 1-844-380-6178, send an e-mail to [email protected], or contact HUD at 1-800-669-9777. If you have information or questions about any other housing discrimination, you can contact the Department at 1-800-896-7743.
U.S. Attorney McSwain Names New Leadership TeamRead the Press Release
PHILADELPHIA – William M. McSwain, U.S. Attorney for the Eastern District of Pennsylvania, has named the office’s new senior executive leadership team.
McSwain, who was sworn in last week, named Assistant U.S. Attorney Jennifer Arbittier Williams to be his First Assistant U.S. Attorney, effective immediately. Williams is currently the office’s Chief of National Security and Cybercrime. For her work as a prosecutor, she was given the Anti-Defamation League’s SHIELD award which recognizes law enforcement success in the fight against hate crime and extremism. She also successfully prosecuted the first case charging material support of terrorists in the history of the district – the so-called “Jihad Jane” case. “It will be an honor to serve as First Assistant,” said Williams. “After serving for 16 years as a prosecutor in this office, I look forward to bringing my experience in fighting terrorism and cybercrime to a new leadership role.”
McSwain named former U.S. Attorney Louis Lappen as Deputy U.S. Attorney. Lappen had served as the U.S. Attorney since November 2017 and as the Acting U.S. Attorney since 2016. As First Assistant U.S. Attorney from 2010 until 2016, he supervised the Criminal, Civil, and Administrative divisions of the office. He has served as an Assistant United States Attorney in the Eastern District since 1997, investigating and prosecuting a variety of cases, including white collar crime, corruption, child exploitation, violent crime, and narcotics distribution. Lappen successfully prosecuted a high-ranking police officer for corruption and securities fraud matters involving hundreds of millions of dollars in losses. He has received numerous awards and commendations including the American Bar Association’s Norm Maleng Minister of Justice Award. “This office has a history of success and stability,” said Lappen. “I’m looking forward to working closely with the U.S. Attorney in maintaining our culture of excellence.”
Denise Wolf, an Assistant U.S. Attorney in the Criminal Division since 2003, has been named Chief of the Criminal Division, effective April 24, 2018. Wolf has served in the white collar/economic crimes unit of the Criminal Division, along with the firearms and corruption units. She has handled a wide variety of cases, including the prosecution Philadelphia Traffic Court judges and court administrators for ticket-fixing, which led to the Pennsylvania legislature abolishing the Traffic Court. In addition, in 2006, Wolf received the Attorney General Award and other commendations for her role in the prosecution of Eli Lily pharmaceutical. “It’s very humbling to be named Chief of the Criminal Division, and I am looking forward to the challenge,” said Wolf. “I’ll be working with some of the most talented prosecutors in the country.”
McSwain has named Gregory David, an Assistant U.S. Attorney in the Civil Division since 2010, as Chief of the Civil Division, also effective April 24, 2018. David has played a key role in several significant civil cases, including a multi-district False Claims Act investigation that led to a $150 million settlement against the largest home health care company in the country. For his work, David received the Department of Justice Civil Division’s Special Commendation. He will supervise all civil matters including affirmative civil enforcement actions and defense of the federal government in civil litigation. “This is one of the most successful and trailblazing civil divisions in the country,” David said. “I look forward to working with and leading a deep bench of talented Assistant U.S. Attorneys.”
“We have an amazing group of talented and dedicated public servants in this office,” said McSwain. “I’m excited about our new leadership team. I look forward to working with them and supporting them in every way possible.”
U.S. Attorney and IRS Warn Potential Tax Cheats to Timely File Accurate and Complete Tax ReturnsRead the Press Release
HARRISBURG - With the deadline for filing income tax returns rapidly approaching, the U.S. Attorney’s Office for the Middle District of Pennsylvania, and the Philadelphia Field Office, IRS Criminal Investigation Division, jointly announced a warning to those who are thinking about breaking the law by committing tax crimes including listing recent tax fraud prosecutions and sentences.
“Millions of individuals file their federal income tax returns in a timely and accurate manner but unfortunately, there are some who choose not to pay their fair share,” said United States Attorney David J. Freed. “These individuals are taking advantage of the honest taxpayers who finance the government’s operations and subject themselves to criminal prosecution.”
“As the 2018 tax season draws to a close, everyone is reminded of their obligation to file tax returns that accurately reflect all of their income and expenses” said Guy Ficco, Special Agent in Charge of the Philadelphia Field Office. "The Special Agents of IRS Criminal Investigation will continue to pursue the prosecution of those who willfully and intentionally violate their known legal duty of filing and paying their fair share of taxes."
Over the last year, the U.S. Attorney’s Office has prosecuted and convicted numerous individuals for filing false federal tax returns and committing tax evasion. Defendants have received substantial sentences for tax fraud, ranging from several years in prison to home confinement. Restitution is mandatory and often includes substantial interest and penalties. For example, the following individuals were charged and/or sentenced for tax fraud recently:
FILING FALSE TAX RETURNS AND TAX EVASION
- Donna Marie Wozniak, age 57, of New Freedom, Pennsylvania, pled guilty on August 14, 2017, to a two-count criminal information charging her with embezzlement in connection with healthcare and tax evasion. Wozniak was the business manager for Susquehanna Valley Surgery Center (SVSC), Harrisburg, Pennsylvania from 2000 through 2014. As part of Wozniak’s job duties, she received invoices form vendors of SVSC that needed to be paid from SVSC’s general operating account. Upon receipt of these invoices, Wozniak would then review the invoices to decide when and how much each vendor would be paid. Wozniak obtained blank checks ostensibly for payment to vendors. During a forensic audit of SVSC's financial records, it was discovered that Wozniak made a portion of the signed blank SVSC checks payable to herself and that these checks were cleared through SVSC's M&T Bank account. Wozniak cashed or deposited a total of $4.3 million utilizing multiple bank accounts she maintained. In order to conceal her theft, Wozniak created false invoices from legitimate SVSC vendors. Wozniak would then falsify entries into the QuickBooks accounting software maintained by SVSC, showing the checks and payments were being made to the vendors. Wozniak admitted to the theft of SVSC funds and was terminated from SVSC in November of 2014. Wozniak failed to report the embezzled income on her Federal Income Tax Returns for a total tax loss of $1,312,000. Wozniak was sentenced to 71 months’ imprisonment and ordered to pay $5,587,026.13 in restitution.
- Richard J. Morgan, age 54, of Shavertown, Pennsylvania, pled guilty on July 7, 2017, for committing bank fraud and interfering with the administration of the Internal Revenue laws. Morgan owned and operated Wilkes-Barre Bookkeeping LLC, a Shavertown, Pennsylvania-based business that provided payroll services to its clients. Local businesses contracted Morgan to pay employee payroll and salary expenses, to file IRS Form 941 Employer Quarterly Federal Tax Returns, and to remit employment tax liabilities to federal, state and local taxation authorities. For three of his clients, Morgan failed to file the IRS Forms 941 and remit the employment taxes to the appropriate authorities, instead embezzling the funds for his own personal use. Between March 2010 and October 2016, Morgan embezzled $376,224.85 from those clients, all while lying to them about his activities. Morgan also served as a Treasurer for a non-profit corporation and was tasked with selling its assets and winding up its operations when it closed in February 2010. Instead, after paying the non-profit corporation’s outstanding liabilities, Morgan embezzled the remaining residual sales proceeds of $68,172. Morgan was sentenced on February 13, 2018, to 38 months’ imprisonment and was ordered to pay $494,618.85 in restitution to his victims and the IRS.
- Nicholas A. Long, age 30, of Mechanicsburg, Pennsylvania, pled guilty on October 4, 2017, to an information charging him with the willful failure to pay federal payroll taxes owed by his business, Harrisburg Commercial Interiors, LLC during 2013. An Internal Revenue Service (IRS) investigation revealed that Long, through his solely owned commercial drywall business, Harrisburg Commercial Interior, LLC (HCI), willfully did not pay $216,304 in payroll taxes during 2013 and 2014. The IRS investigation began when several HCI employees contacted the IRS because they did not receive their 2013 income tax refunds. As the owner of HCI, Long exercised primary control over the financial affairs of the business, was solely responsible for issuance of all paychecks, and had sole signature authority on HCI's business bank account. Although he issued payroll checks totaling $730,788 in gross wages during 2013 and 2014, Long did not file the requisite Employer's Quarterly and Annual Federal Tax Returns, Forms and 940, with the IRS, nor pay over the $160,399 he withheld from his employees’ pay checks to the government. Long was sentenced on March 9, 2018, to one year and one day imprisonment and ordered to make full restitution in the amount of $216,304.
- Michael Powers, age 53, of New Cumberland, Pennsylvania, who owns and operates Powers Auto Repair in New Cumberland, pled guilty on September 11, 2017, to understating his true income by $238,381 on his 2010 income tax return. The tax owed on that unreported income amounted to $42,774. Under the terms of his plea agreement, Powers will make restitution to the Internal Revenue Service (IRS) in that amount plus another $26,198 for unpaid taxes owed on unreported income of $208,979 for tax year 2012. Thus, the total loss to the IRS as a result of Powers’ underreporting of income was $68,972. Powers was sentenced on March 12, 2018, to one year probation and home confinement and ordered to pay $68,972 in restitution.
- Sopheak Kim, age 68, of Harrisburg, Pennsylvania, pled guilty on March 28, 2018, to willful failure to collect or pay employment tax and corruptly endeavoring to obstruct and impede the due administration of the Internal Revenue Service. Kim owned and operated Trojan Services, Inc., a Harrisburg-based company which contracted to provide labor to local companies. From 2010 through 2013, Kim failed to maintain business records relating to the operation of Trojan Services, Inc., to include records relating to employees, payroll and tax withholdings. The total tax loss alleged is approximately $250,110. Kim is awaiting sentencing.
- Atef Hussein, age 48, of Hagerstown, Maryland, pled guilty on October 30, 2017, to income tax evasion. Hussein, former owner/operator of the Fairground Diner in Carlisle, Pennsylvania, understated income and taxes due, resulting in false income tax returns for tax years 2012 through 2015. The tax loss for that period totaled $122,003. Hussein is scheduled to be sentenced on May 30, 2018.
- Geraldo Ramos, age 44, of Harrisburg, Pennsylvania, pled guilty on November 13, 2017, to conspiracy to submit false claims and submitting false claims against the United States regarding income tax refunds. Between 2010 and 2014, Ramos acted as a tax return preparer and filed numerous false and fraudulent tax returns for family and friends claiming $58,659 in refunds they were not entitled to receive. As a result, the IRS paid the conspirators $52,711, which was shared with Ramos. The fraudulent tax returns included misrepresenting Schedule C income, listing fictitious dependents and manipulating filing status. Ramos is scheduled to be sentenced on April 24, 2018.
- Donald Royce, age 41, of Scranton, Pennsylvania, was indicted on May 16, 2017, for tax preparation fraud charges. Royce was a tax preparer in Scranton who defrauded a number of local residents in 2014. The indictment alleges that Royce prepared fraudulent tax returns for multiple taxpayers causing more than $250,000 in losses. Royce gave the taxpayers a client copy of their tax return, then made material fraudulent changes to the client copy, and submitted the false return to the Internal Revenue Service (IRS) for his financial benefit. The indictment further alleges that Royce took clients’ IRS payment checks and deposited them directly in to his own account without ever remitting the amount to the IRS, all without the taxpayers’ knowledge. Royce is awaiting trial.
STOLEN IDENTITY REFUND FRAUD
In addition to prosecuting tax evaders and fraudulent tax return preparers, the IRS and the U.S. Attorney’s Office are continuing a major effort to investigate and prosecute individuals who steal the identities of taxpayers and file fraudulent tax returns.
Federal penalties for each count of conviction of tax crimes range from a maximum of one year in prison and a $100,000 fine for failure to file a tax return, false withholding exemptions, and delivering or disclosing false tax documents, to a maximum of 10 years in prison and a $250,000 fine for conspiracy to defraud with respect to false refund claims. Other penalties include a mandatory term of two years in prison and a $250,000 fine for aggravated identity theft charges, three years in prison and a $250,000 fine for obstructing or impeding an investigation and filing or preparing a false tax return, and a maximum of five years in prison and a $250,000 fine for tax evasion, failure to pay taxes, conspiracy to commit a tax offense or conspiracy to defraud.
TAX SCAM WARNING
The U.S. Attorney’s Office and the IRS remind tax payers to exercise caution during tax season to protect themselves against tax schemes ranging from identity theft to return preparer fraud. Illegal scams can lead to significant penalties and interest and possible criminal prosecution. IRS Criminal Investigation works closely with the Department of Justice to shutdown scams and to prosecute the criminals behind them. The IRS would like to warn taxpayers of a quickly growing scam involving erroneous tax refunds being deposited into their bank accounts. Criminals steal client data from tax professionals and filing fraudulent tax returns, these criminals use the taxpayers' real bank accounts for the deposit. Thieves are then using various tactics to reclaim the refund from the taxpayers, and their versions of the scam may continue to evolve. In one version of the scam, criminals posing as debt collection agency officials acting on behalf of the IRS contacted the taxpayers to say a refund was deposited in error, and they asked the taxpayers to forward the money to their collection agency. In another version, the taxpayer who received the erroneous refund gets an automated call with a recorded voice saying he is from the IRS and threatens the taxpayer with criminal fraud charges, an arrest warrant and a “blacklisting” of their Social Security Number. The recorded voice gives the taxpayer a case number and a telephone number to call to return the refund.
The IRS urges taxpayers to follow established procedures for returning an erroneous refund to the agency. The IRS also encourages taxpayers to discuss the issue with their financial institutions because there may be a need to close bank accounts. Taxpayers receiving erroneous refunds also should contact their tax preparers immediately. Here are the official ways to return an erroneous refund to the IRS. If the erroneous refund was a direct deposit:
- Contact the Automated Clearing House (ACH) department of the bank/financial institution where the direct deposit was received and have them return the refund to the IRS.
- Call the IRS toll-free at 800-829-1040 (individual) or 800-829-4933 (business) to explain why the direct deposit is being returned.
If the erroneous refund was a paper check and hasn't been cashed:
- Write "Void" in the endorsement section on the back of the check.
- Submit the check immediately to the appropriate IRS location listed below.The location is based on the city (possibly abbreviated) on the bottom text line in front of the words TAX REFUND on your refund check.
- Don't staple, bend, or paper clip the check.
- Include a note stating, "Return of erroneous refund check because (and give a brief explanation of the reason for returning the refund check)."
The erroneous refund was a paper check and you have cashed it:
- Submit a personal check, money order, etc., immediately to the appropriate IRS location listed below.
- If you no longer have access to a copy of the check, call the IRS toll-free at 800-829-1040 (individual) or 800-829-4933 (business) (see telephone and local assistance for hours of operation) and explain to the IRS assistor that you need information to repay a cashed refund check.
- Write on the check/money order: Payment of Erroneous Refund, the tax period for which the refund was issued, and your taxpayer identification number (social security number, employer identification number, or individual taxpayer identification number).
- Include a brief explanation of the reason for returning the refund.
- Repaying an erroneous refund in this manner may result in interest due the IRS.
For your paper refund check, here are the IRS mailing addresses to use based on the city (possibly abbreviated). These cities are located on the check’s bottom text line in front of the words TAX REFUND:
- ANDOVER – IRS, 310 Lowell Street, Andover, MA 01810
- ATLANTA – IRS, 4800 Buford Highway, Chamblee, GA 30341
- AUSTIN – IRS, 3651 South Interregional Highway 35, Austin, TX 78741
- BRKHAVN – IRS, 5000 Corporate Ct., Holtsville, NY 11742
- CNCNATI – IRS, 201 West Rivercenter Blvd., Covington, KY 41011
- FRESNO – IRS, 5045 East Butler Avenue, Fresno, CA 93727
- KANS CY – IRS, 333 W. Pershing Road, Kansas City, MO 64108-4302
- MEMPHIS – IRS, 5333 Getwell Road, Memphis, TN 38118
- OGDEN – IRS, 1973 Rulon White Blvd., Ogden, UT 84201
- PHILA – IRS, 2970 Market St., Philadelphia, PA 19104
Education is the best way to avoid these common schemes. To learn more about other scams and for help with recognizing and avoiding abusive tax schemes, the IRS offers educational material at www.irs.gov.
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Two Sentenced for Roles in Drug Trafficking ConspiracyRead the Press Release
Abingdon, VIRGINIA – Two of seven individuals who conspired to distribute more than 50 grams of crystal methamphetamine in Southwest Virginia from sources in Tennessee and Kentucky were sentenced Tuesday in U.S. District Court in Abingdon, United States Attorney Thomas T. Cullen and Virginia Attorney General Mark R. Herring announced.
Todd Houston Conyer, 30, of Pennington Gap, Va., was sentenced Tuesday, April 10 to a term of imprisonment of 60 months. He had previously pleaded guilty to conspiring to distribute methamphetamine.
In a separate hearing on the same day, Leslie Ann Clasby, 42, of Jonesville, Va., was sentenced to a term of 84 months of imprisonment. Clasby likewise had previously pleaded guilty to conspiring to distribute methamphetamine.
“Crystal methamphetamine is a dangerous drug that poses significant risks to those who use it,” U.S. Attorney Thomas Cullen said. “I appreciate the efforts of our law-enforcement partners and their hard work in dismantling this illegal enterprise.”
“My team is committed to aggressively prosecute those engaged in the distribution of dangerous drugs,” said Attorney General Mark Herring. “We work hard to make our communities safer and appreciate our partnership with federal, state, and local law enforcement agencies to achieve this important goal.”
According to evidence presented at previous hearings by Virginia Assistant Attorney General and Special Assistant United States Attorney Suzanne Kerney-Quillen and Assistant United States Attorney Randy Ramseyer, the defendants engaged in a conspiracy to distribute and possess with the intent to distribute crystal ice methamphetamine from April 1, 2016, through November 7, 2016. Court documents demonstrated that the conspiracy involved over 50 grams of crystal ice methamphetamine, acquired from multiple sources in Tennessee and Kentucky, and several firearms. Numerous undercover purchases of crystal ice were conducted by the Southwest Virginia Drug Task Force at Sturgill’s residence in Jonesville, Virginia, where much of the activity concerning the conspiracy occurred.
The remaining five defendants in the case, Jeremy Rick Sturgill, Tony Lynn Ketron, Jason Dale Moore, William Benjamin Brewer, and Kristina Karen Burton have all pleaded guilty to related drug and firearms charges and will be sentenced later in April 2018.
The Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Lee County Sheriff’s Office, the Scott County Sheriff’s Office, the Virginia State Police, the Jonesville Police Department, and the Southwest Virginia Drug Task Force investigated the case. Assistant United States Attorney Randy Ramseyer prosecuted the case for the United States involving Leslie Ann Clasby. Special Assistant United States Attorney M. Suzanne Kerney-Quillen, a Virginia Assistant Attorney General assigned to the Attorney General’s Major Crimes and Emerging Threats Section, prosecuted the case for the United States involving all other defendants.
Two Portland Marijuana Proprietors Accused of Tax CrimesRead the Press Release
PORTLAND, Ore. – Today in separate criminal informations, tax charges were filed in federal court against two Portland-based marijuana business owners. Nathan Wheeler, 42, of Portland, was charged with one count each of wire fraud and tax evasion. Matthew Price, 32, also of Portland, faces four counts of willfully failing to file income tax returns.
According to court documents, Wheeler, a certified public accountant, is alleged to have engaged in a scheme to defraud clients and investors of more than $4.4 million while also evading income taxes. Wheeler and others operated Bridge City Advisors, LLC, offering accounting, investment, and legal services to clients throughout Portland. Wheeler also held an Oregon medical marijuana license to grow and distribute marijuana. He is accused of using investor funds, without their knowledge or consent, in part, to build and expand his marijuana enterprise. In carrying out his fraud, he sometimes prepared false account statements to keep clients from discovering the unauthorized use of funds.
Beginning in August 2013, Price was part owner and operator of a Portland-based medical marijuana dispensary. In 2014, Price and his business partner opened two additional retail locations, a second in Portland and one in Eugene, Oregon. Between 2011 and 2014, Price allegedly received substantial income from the business and a marijuana farmers’ market he previously owned and operated. During this four-year period, Price is accused of failing to file individual income tax returns, resulting in a tax loss of nearly $263,000.
Both defendants are expected to make their first appearance in federal court on Wednesday, April 25, 2018.
A criminal charge is only an accusation of a crime, and a defendant is presumed innocent unless and until proven guilty.
Two Erie Residents Indicted on Drug Charges Resulting in DeathRead the Press Release
ERIE, Pa. – A federal grand jury in Erie, Pennsylvania, has returned separate indictments charging two Erie residents with violating federal drug laws, United States Attorney Scott W. Brady announced today.
"To combat the deadly opioid epidemic, the U.S. Attorney’s Office will use every lawful tool in our arsenal to identify and prosecute drug traffickers whose products poison our citizens," stated U.S. Attorney Brady. "The federal statute pertaining to drug distribution resulting in serious bodily injury or death carries a 20-year mandatory minimum sentence and up to life in prison. Severe penalties are warranted when drug dealers knowingly distribute drugs that kill our fellow citizens."
Erie County District Attorney Jack Daneri added, "Local law enforcement in this county will continue to work closely with our federal partners to put maximum effort at addressing the opioid overdose epidemic. We will continue to work with the Drug Enforcement Administration and the U.S. Attorney, and we will make referrals for federal prosecution where the facts warrant."
A seven-count indictment, returned yesterday, named Damon Dupree Henderson, aka Dee, aka Db, age 28, as the sole defendant.
According to the indictment presented to the court, Henderson sold a quantity of fentanyl and a quantity of cocaine that caused the death of R.R.T. on June 15, 2017. The indictment also charges Henderson with possessing with intent to distribute various amounts of heroin, fentanyl, a heroin/fentanyl mixture, cocaine, and crack cocaine on or about June 20, 2017.
A three-count indictment, also returned yesterday, named Derrick Lamont Hemphill, Sr., aka G, aka Shelly, age 27, as the sole defendant.
According to the indictment presented to the court, Hemphill sold fentanyl that caused the death of K.A.J. on November 26, 2017. The indictment also alleges that on November 26, 2017, Hemphill possessed with intent to distribute fentanyl and a heroin/fentanyl mixture.
For Henderson, the law provides for a maximum total sentence of life in prison, a fine of $12,000,000, or both. For Hemphill, the law provides for a maximum total sentence of life in prison, a fine of $3,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Marshall J. Piccinini is prosecuting these cases on behalf of the government.
The Erie County District Attorney’s Office County Detective Bureau, the Erie County District Attorney’s Office Drug Task Force, the Millcreek Township Police Department, and the Erie Police Department, with assistance from the Drug Enforcement Administration, conducted the investigation leading to the indictments in these cases.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Two Drivers Plead Guilty to Conspiracy to Transport Illegal AliensRead the Press Release
Gulfport, Miss. – Ever Anibal Silva-Escobar also known as Ever Silva Escobar, age 18, and a citizen of El Salvador, pled guilty today before U.S. District Judge Louis Guirola, Jr. to conspiracy to transport illegal aliens within the United States, announced U.S. Attorney Mike Hurst, Acting Special Agent in Charge Thomas M. Annello, Special Agent in Charge of U.S. Immigration and Customs Enforcement's Homeland Security Investigations in New Orleans, and Joseph A. Banco Jr., Acting Chief Patrol Agent of the U.S. Border Patrol’s New Orleans Sector.
Previously, on April 3, 2018, Kenneth Samuel Hernandez-Valdez also known as Kenneth Hernandez, an 18-year old citizen of Honduras, pled guilty before Judge Guirola to the same offense as part of the same conspiracy. Both Silva-Escobar and Hernandez-Valdez were found guilty with Hernandez-Valdez scheduled to be sentenced by Judge Guirola on June 27, 2018, and Silva-Escobar scheduled to be sentenced on July 17, 2018. They each face a potential maximum sentence of 10 years in prison and a $250,000 fine, as well as special assessments that could total $5,100.
On January 30, 2018, two Hancock County Sheriff’s Deputies, working together, but in separate patrol vehicles, conducted traffic stops of two Honda Pilot Sport Utility Vehicles (SUVs) that were traveling together. Silva-Escobar was the driver of one of the SUVs and Hernandez-Valdez was the driver of the other SUV. The U.S. Border Patrol was contacted and arrived on the scene shortly thereafter.
Neither of the drivers had a valid driver’s license, and both were found to be in the United States illegally. Each vehicle contained eight passengers who also were found to be illegal aliens. All eighteen occupants of both vehicles were arrested and transported to the Border Patrol Station in Gulfport, MS.
Silva-Escobar, who was working and living in Houston, Texas, and Hernandez-Valdez, who had attended high school in Texas and speaks both English and Spanish, confirmed that they knew their passengers were illegal aliens and that they were being paid to transport them from Texas. They also admitted that they were friends with each other, and were willing participants in the conspiracy to transport illegal aliens.
Also pleading guilty to separate felonies, were three of the passengers in the SUVs. Pedro Lopez-Alvarez also known as Pedro Alvarez-Baten, age 21, a citizen of Guatemala; Silvano Doroteo Morales-Ventura, age 23, a citizen of Mexico; and Wilmer Antonio Rubi-Padilla, age 25, a citizen of Honduras, pleaded guilty on April 10, 2018, before Judge Guirola, to the crime of Unlawful Re-entry by an Alien After Deportation or Removal.
Lopez-Alvarez, Morales-Ventura and Rubi-Padilla were found guilty of their felony offenses and are scheduled to be sentenced by Judge Guirola on July 3, 2018. Each of the three men faces a potential maximum 2 years imprisonment, not more than 1 year supervised release, a maximum $250,000 fine, and a special assessment of $100.
Finally, in addition to their potential maximum sentences of imprisonment, supervised release and fines, all of the defendants from this incident will be subject to Department of Homeland Security removal proceedings upon the completion of their sentences.
The case was investigated by Homeland Security Investigations, the U.S. Border Patrol, and the Hancock County Sheriff’s Department. Assistant United States Attorney Stan Harris is the prosecutor for the case.
Two Defendants Indicted in Brooklyn Federal Court for Foreign Exchange Trading ScamsRead the Press Release
Earlier today, in federal court in Brooklyn, an indictment was unsealed charging Tae Hung Kang, also known as “Kevin Kang,” and John Won with conspiring to commit wire and securities fraud, securities fraud, and conspiring to commit money laundering, in connection with schemes involving foreign exchange trading that targeted members of the Korean-American community. Kang was also charged with substantive wire fraud. The defendants were arrested today and are scheduled to be arraigned this afternoon before United States Magistrate Judge Sanket J. Bulsara.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the charges.
“As alleged in the indictment, Kang and Won lured investors with false promises of great profits to be made in the foreign exchange market, and then stole their money,” stated United States Attorney Donoghue. “This Office, together with our law enforcement partners, is committed to investigating and prosecuting fraudsters who prey upon the investing public.” Mr. Donoghue expressed his appreciation to the United States Commodities and Futures Trading Commission and the FBI Field Office in Atlanta for their assistance during the investigation.
“As alleged, Kang and Won pursued victims with specific placement of advertisements in Korean-language newspapers, preying upon the kinship of their target group and exploiting their affiliation with this particular community,” stated FBI Assistant Director-in-Charge Sweeney. “In addition, they falsely represented their trading credentials while persuading investors to contribute additional money in stock—money that was eventually misappropriated. The FBI will continue to dedicate resources to uncovering financial crimes of all kinds, especially those that seek to capitalize on the trust and affinity of innocent victims.”
As alleged in court documents, dozens of investors in the Eastern District of New York were defrauded in connection with the two charged schemes, both of which involved foreign exchange trading. Foreign exchange trading refers to trading one currency for another in an effort to profit from fluctuating exchange rates. In connection with the first alleged scheme, investors were enticed by advertisements placed by the defendants in Korean-language newspapers and other promotional materials to open foreign exchange trading accounts that would be managed by Kang, Won and others at their company FOREXNPOWER. Kang and Won promised investors double-digit returns, claiming to have a secret algorithmic trading method that would generate large profits with minimal risk. In fact, Kang and Won had minimal trading experience, their algorithmic trading method never performed as promised, and investors suffered substantial losses.
In the second scheme, investors were persuaded by the defendants to invest their money into stock issued by Safety Capital Management, Inc. (“Safety Capital”), which did business as FOREXNPOWER. These investors were told their investments would be pooled by Kang and others to conduct foreign exchange trading, or to expand the FOREXNPOWER business, and, again, promised a large return on their investment. Ultimately, nearly all of the money that was invested in Safety Capital stock, totaling at least $700,000, was misappropriated by the defendants. The defendants used the stolen money to pay for advertisements targeting investors and promoting FOREXNPOWER.
If convicted of wire fraud conspiracy, the defendants each face up to 20 years’ imprisonment.
The charges in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorney Lauren Howard Elbert is in charge of the prosecution.
The Defendants:
TAE HUNG KANG (also known as “Kevin Kang”)
Age: 55
Bayside, New YorkJOHN WON
Age: 49
Flushing, New YorkE.D.N.Y. Docket No. 18-CR-184 (WFK)
Two Austin Area Men and an Arizona Machine Gun Manufacturer Charged in Connection with Firearms Smuggling SchemeRead the Press Release
In Austin today, federal charges were filed against two Austin area residents and an Arizona machinegun manufacturer in connection with a firearms smuggling scheme that involved machine guns and assault weapons, announced United States Attorney John F. Bash; Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Special Agent in Charge Fred J. Milanowski, Houston Division; Homeland Security Investigations (HSI) Special Agent in Charge Shane Folden; and, United States Postal Inspection Service (USPIS) Inspector in Charge Adrian Gonzalez, Houston Division.
A two–count Information charges 28–year-old Tyler Carlson of Austin, 69-year-old Michael Fox of Georgetown, TX, and 62–year-old Tracy Garwood of Scottsdale, AZ, with one count of conspiracy to violate multiple federal laws, including possessing and transferring unregistered machineguns and unlawfully exporting firearms to Mexico. Additionally, Carlson is charged with one substantive count of possession of an unregistered machinegun.
“We need to vigorously enforce the firearm laws that are on the books, and these charges are part of that mission,” stated United States Attorney John F. Bash.
According to the Information, Carlson worked with others to acquire and unlawfully smuggle 200 firearms, including .50 caliber rifles, and hundreds of thousands of rounds of ammunition to Mexico.
Additionally, according to the Information, Carlson worked with Michael Fox, a former law enforcement officer and federal firearms licensee, to illegally acquire multiple M-134G Minigun machineguns. The M-134G is a six-barrel rotary machine gun that can fire between 2,000 and 6,000 rounds of ammunition per minute. Fox then contacted Garwood, owner of Garwood Industries in Scottsdale, who agreed to help with the construction and supply Fox with M-134G parts.
Garwood submitted false paperwork to the ATF claiming he had destroyed multiple M-134G rotor housings—a key component of the M-134G that must be serialized and registered with the ATF. Instead, according to the Information, Garwood unlawfully transferred possession of those rotor housings to Fox.
On February 8, 2017, authorities recovered three M134G rotor housings while executing a search warrant at Fox’s residence in Georgetown, Texas. Two of the rotor housings were ones that Garwood told ATF were destroyed.
The Information also states that prior to the search warrant, Fox successfully built multiple M-134G machineguns, unlawfully transferred them to Carlson, who in turn transferred them to an unnamed person. That person successfully smuggled M-134G machineguns to Mexico.
“Firearms trafficking is a priority for ATF because of the increased potential for those guns to be acquired by the criminal element,” said ATF Special Agent in Charge Fred Milanowski.
“By arresting weapons smugglers, law enforcement cuts the supply of firearms to the drug cartels, who fuel violence and pose a threat to citizens on both sides of the border,” said Special Agent in Charge Shane Folden, HSI San Antonio.
“The Postal Inspection Service is committed to protecting the financial systems of the Postal Service by investigating money laundering activities involving the misuse of Postal Service products and money orders to facilitate criminal activity. We remain steadfast in our resolve to seek justice to the end and defend the nation’s mail service from illegal use. This goal is achieved through collaborative investigative efforts with other law enforcement agencies,” stated USPIS Inspector in Charge Adrian Gonzalez
Upon conviction, Carlson faces up to 10 years on the substantive unlawful possession of a machinegun charge, and each defendant faces up to five years in federal prison on the conspiracy charge. No further court dates are scheduled at this time.
The ATF, HSI, USPIS are conducting this investigation. The U.S. Marshal Service assisted with the deportation of Carlson from Mexico. The Southern District of Texas and the District of Arizona provided assistance during this investigation. Assistant United States Attorney Michael Galdo is prosecuting this case on behalf of the Government.
An Information is merely a charge and should not be considered as evidence of guilt. The defendants are innocent until proven guilty in a court of law.
Town of Ticonderoga Agrees to Bring Drinking Water System into ComplianceRead the Press Release
Acting Assistant Attorney General Jeffrey H. Wood for the Environment and Natural Resources Division, U.S. Attorney Grant C. Jaquith for the Northern District of New York, Regional Administrator Pete Lopez for the U.S. Environmental Protection Agency (EPA), and New York State Attorney General Eric T. Schneiderman announced today that the Town of Ticonderoga, New York has entered into a consent decree to bring the town into compliance with the federal Safe Drinking Water Act and Part 5 of the New York State Sanitary Code. Under the terms of the agreement, Ticonderoga will switch the source of about half of the drinking water it provides to a groundwater source.
“Clean drinking water is a priority for all Americans. This agreement is carefully crafted to ensure that the Town of Ticonderoga is able to make required upgrades to its drinking water systems in a timely, cost-effective, and appropriate manner, while also ensuring that local residents are notified immediately if drinking water contamination is found,” said Acting Assistant Attorney General Wood for the Justice Department’s Environment and Natural Resources Division. “We will continue to work with our federal, state, and local partners to ensure compliance with the Safe Drinking Water Act.”
“With this agreement, and with support and technical assistance from the state and federal government, Ticonderoga has a path forward to ensure that the people of Ticonderoga receive clean drinking water,” said EPA Regional Administrator Pete Lopez.
“It is fitting that a town named for its location as the junction of two majestic waterways has committed to provide clean and protected water to its residents,” said United States Attorney Grant C. Jaquith. “We will continue to work with the Environment and Natural Resources Division, the EPA, and state and local authorities to ensure compliance with the federal Safe Drinking Water Act and to protect public health in Ticonderoga and throughout the Northern District of New York.”
“Every New Yorker should have access to safe, clean drinking water, and this agreement ensures that for Ticonderoga residents,” said Attorney General Schneiderman. “My office is proud of this collaborative victory and remains committed to improving environmental safety and public health across our state.”
The Town of Ticonderoga owns and operates an unfiltered drinking water system with an uncovered finished water reservoir that provides drinking water to approximately 5,000 customers. The water system does not meet state and federal regulatory requirements. The town has been out of compliance with a federal Safe Drinking Water Act regulation called the Long Term 2 Enhanced Surface Water Treatment Rule (LT2). Specifically, the system does not have proper treatment for Cryptosporidium. The LT2 rule specifically targets public water systems with surface water as their source, which have higher potential risks of Cryptosporidium contamination. These systems are required to treat unfiltered surface water for Cryptosporidium, which can lead to serious and potentially fatal gastrointestinal illness. The illness poses greater risks to people with weakened immune systems, such as young children, pregnant women, and the elderly. The rule also requires that reservoirs that hold finished drinking water (water that is ready to drink) be covered to protect them from contamination.
Under the terms of the consent decree filed yesterday, the Town of Ticonderoga will install wells to draw drinking water from the groundwater and install a storage tank to ensure a clean and protected water supply—projects that will cost approximately $13 million. The town will also complete improvements to the Baldwin Road filter plant by June 2020. While the work to accomplish these capital improvements is being completed, the consent decree requires the town notify the public immediately if sampling indicates any elevated risk of Cryptosporidium contamination.
In addition to the work required to ensure its system meets federal and state requirements, Ticonderoga has agreed to two additional actions under EPA’s Supplemental Environmental Projects policy. First, the town has agreed to establish a program to notify residents of water system outages or concerns, including boil-water notices. This notification program will also enable notification of other emergencies, including sewer or gas line breakages, flooding, police activity, and severe weather, by phone call, email, or text message. Second, the town will establish a pharmaceutical disposal program to anonymously accept any unwanted pharmaceutical products. The program will reduce the quantity of pharmaceuticals released to the environment that might otherwise make their way into the community’s drinking water. The town will also pay a $50,000 penalty to be divided evenly between the United States and New York State.
The consent decree has been lodged with the U.S. District Court for the Northern District of New York and is subject to public comment for a period of at least 30 days. Notice of the lodging of the consent decree will appear in the Federal Register allowing for a 30-day public comment period before the consent decree can be entered by the court as final judgment. The consent decree will available for viewing at www.justice.gov/enrd/Consent_Decrees.html.
For more information on the Safe Drinking Water Act, please visit: www.epa.gov/sdwa
Three people indicted for illegally reentering the U.S. after multiple deportationsRead the Press Release
Three people were indicted for illegally reentering the United States after multiple deportations.
Misael De Jesus Constanza Hernandez, 29, a citizen of El Salvador, was found in Ohio last month after having previously been deported three times, according to the indictment.
Victor Guadalupe Gonzales, 46, a citizen of Mexico, was found in Ohio last month after having been previously deported twice, according to the indictment.
Rafael Eustate-Santos, a citizen of the Dominican Republic, was found in Ohio last month after having been previously deported twice, according to the indictment.
The cases were investigated by Immigration and Customs Enforcement, Department of Homeland Security. They are being prosecuted by Assistant U.S. Attorneys Kathryn Andrachick, Brian Deckert and Danielle Angeli.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial, in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Three men plead guilty to concealing sending money to Anwar Al-AwlakiRead the Press Release
Three men pleaded guilty to their roles in concealing the provision of thousands of dollars to Anwar Al-Awlaki in an effort to support violent jihad against U.S. military personnel in Iraq, Afghanistan and throughout the world.
The guilty pleas were announced by Assistant Attorney General for National Security John C. Demers, U.S. Attorney Justin E. Herdman of the Northern District of Ohio and Special Agent in Charge Stephen D. Anthony of the FBI’s Cleveland Division.
Ibrahim Zubair Mohammad, 38; Asif Ahmed Salim, 37; and Sultane Room Salim, 43, each pleaded guilty this week to one count of concealment of financing of terrorism. They are expected to be sentenced later this year.
“These defendants provided thousands of dollars to finance terrorism, then used every effort to conceal their activity from law enforcement,” U.S. Attorney Herdman said. “This case demonstrates that we will work around the clock and across the globe to ensure that anyone who seeks to do our nation harm, whether on the battlefield or through the banking system, will be held accountable.”
“These three individuals have now accepted responsibility for taking steps to conceal that they gave funds to a known terrorist,” said Special Agent in Charge Anthony. “The identification of the provision of these funds to a dangerous terrorist and the subsequent investigation demonstrates how members of the FBI's Joint Terrorism Task Force worked with our international law enforcement partners to mitigate threats in order to protect our citizens.”
A fourth defendant, Yahya Farooq Mohammad, pleaded guilty last year to one count of conspiracy to provide and conceal material support or resources to terrorists and one count of solicitation to commit a crime of violence. Farooq Mohammed admitted to conspiring to travel to Yemen to provide thousands of dollars, equipment, and other assistance to Al-Awlaki. He also admitted to soliciting an undercover FBI employee posing as a hitman to kidnap and murder U.S. District Judge Jack Zouhary. He was sentenced to 27 ½ years in prison last year.
Ibrahim Mohammad, was an Indian citizen who studied engineering at the University of Illinois Urbana-Champaign from 2001 through 2005. In or around 2006, he moved to Toledo, Ohio, and married a U.S. citizen. He became a lawful permanent resident of the United States in or around 2007.
Asif Salim was a U.S. citizen who studied at Ohio State University between 2000 and 2005. He became a resident of Overland Park, Kansas, in 2007. His brother, Sultane Salim, is also a U.S. citizen who resided in the Chicago area from 2006 through 2012, until he moved to the Columbus area, according to court documents.
The three defendants who pleaded guilty this week acted to conceal supplying funds to Anwar Al-Awlaki in 2009. Al-Awlaki, a key leader of Al Qaeda in the Arabian Peninsula, advocated violence against the United States and supported and was involved in attempted terrorist attacks against civilians, according to court documents.
Farooq Mohammad travelled with two other people to Yemen in 2009 to meet Awlaki. They were unable to meet with Awlaki, so instead travelled to Sana’a, Yemen, to meet with one of his associates. Farooq Mohammad and his two fellow travelers gave the associate approximately $22,000 to be given to Awlaki, according to court documents. The money Farooq Mohammad provided included approximately $17,000 that had been provided by Asif and Sultane Salim in the United States. Ibrahim Mohammad facilitated the transfer of the money to Farooq Mohammad overseas for him to take to Awlaki in Yemen.
After law enforcement began investigating the financial transactions involved in the funds provided to Awlaki, Ibrahim Mohammad, Asif Salim, and Sultane Salim attempted to conceal the source of the funds provided to Awlaki by lying to investigators and deleting emails from their accounts that were related to the transactions.
The case is being investigated by the FBI. This case is being prosecuted by Assistant U.S. Attorneys Matthew W. Shepherd and Michael J. Freeman of the Northern District of Ohio, and Trial Attorneys David Smith and Gregory Gonzalez of the National Security Division’s Counterterrorism Section.
Three People Charged with Interstate Gun Trafficking Conspiracy Spanning from Virginia to New JerseyRead the Press Release
NEWARK, N.J. – A Virginia woman who is an active-duty member of the U.S. Navy and a New Jersey couple have been charged with conspiring to illegally purchase five semi-automatic handguns bound for New Jersey, U.S. Attorney Craig Carpenito announced today.
Tesora Amanda Cortes Trejorojas, 23, of Norfolk, Virginia; Azia Sinclair, 28, of Newark; and Shyheim Tyson, a/k/a “Shy,” 22, of Newark, are charged by a superseding complaint with one count of conspiring to transport and receive in New Jersey firearms purchased and obtained outside the State of New Jersey. Sinclair had previously been charged by complaint filed in Newark federal court on March 12, 2018, for receiving a firearm, which had been shipped or transported in interstate commerce.
Trejorojas was arrested this morning and will appear this in Norfolk, Virginia, federal court. Sinclair and Tyson will appear on April 26, 2018, before U.S. Magistrate Judge Mark Falk in Newark federal court.
According to documents filed in this case and statements made in court:
In November 2017, Trejorojas and Sinclair allegedly engaged in numerous text messages with each other planning for Trejorojas to purchase firearms in Virginia, which Sinclair and her boyfriend, Tyson, would then transport back to New Jersey.
On Nov. 11, 2017, Sinclair and Tyson drove from New Jersey to Trejorojas’ residence in Norfolk. The three of them then went to a gun store in Norfolk, where Trejorojas purchased five semiautomatic handguns, as well as 200 rounds of ammunition, with cash provided by Sinclair and Tyson. The next day, Sinclair and Tyson drove back to New Jersey with the five handguns and ammunition.
Approximately five hours after Sinclair and Tyson arrived back in New Jersey, an individual was arrested in Orange, New Jersey, after police officers responded to the sound of gunshots. During the arrest, police officers recovered one of the five handguns that Sinclair and Tyson had transported from Virginia to New Jersey.
In March 2018, law enforcement executed a search warrant on Sinclair’s residence in Newark, and found another of the guns that Sinclair and Tyson had transported from Virginia to New Jersey in November 2017.
The conspiracy to deal in firearms without a license carries a maximum potential penalty of five years in prison and a $250,000 fine.
U.S. Attorney Carpenito credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge John B. Devito, Newark Field Division, and Special Agent in Charge Thomas L. Chittum III, Washington Field Division, with the investigation leading to today’s charges. He also thanked the N.J. State Police; the Newark Department of Public Safety: and Naval Criminal Investigative Service (NCIS) in Norfolk for their assistance.
The government is represented by Assistant U.S. Attorney Jonathan W. Romankow of the Violent Crimes Unit in Newark.
The charges and allegations in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Defense counsel: Trejorojas: TBD
Sinclair: Linda Foster Esq., Assistant Federal Public Defender
Tyson: TBDThree Men Plead Guilty to Concealing Sending Funds to Anwar Al-AwlakiRead the Press Release
Ibrahim Zubair Mohammad, 38; Asif Ahmed Salim, 38; and Sultane Room Salim, 43, pleaded guilty this week to one count of concealment of financing of terrorism, for their roles in concealing the provision of thousands of dollars to Anwar Al-Awlaki in an effort to support violent jihad against U.S. military personnel in Iraq, Afghanistan and throughout the world.
Assistant Attorney General for National Security John C. Demers, U.S. Attorney Justin E. Herdman of the Northern District of Ohio and Special Agent in Charge Stephen D. Anthony of the FBI’s Cleveland Division announced the pleas.
A fourth defendant, Yahya Farooq Mohammad, pleaded guilty last year to one count of conspiracy to provide and conceal material support or resources to terrorists and one count of solicitation to commit a crime of violence. Farooq Mohammed admitted to conspiring to travel to Yemen to provide thousands of dollars, equipment and other assistance to Al-Awlaki. He also admitted to soliciting an undercover FBI employee posing as a hitman to kidnap and murder U.S. District Judge Jack Zouhary. He was sentenced to 27 ½ years in prison last year.
Ibrahim Mohammad, an Indian citizen, studied engineering at the University of Illinois Urbana-Champaign from 2001 through 2005. In or around 2006, he moved to Toledo, Ohio, and married a U.S. citizen. He became a lawful permanent resident of the United States in or around 2007.
Asif Salim, a U.S. citizen, studied at Ohio State University between 2000 and 2005. He became a resident of Overland Park, Kansas, in 2007. His brother, Sultane Salim, is also a U.S. citizen who resided in the Chicago area from 2006 through 2012, until he moved to the Columbus area, according to court documents.
The three defendants who pleaded guilty this week acted to conceal supplying funds to Anwar Al-Awlaki in 2009. Al-Awlaki, a key leader of Al Qaeda in the Arabian Peninsula, advocated violence against the United States and supported and was involved in attempted terrorist attacks against civilians, according to court documents.
Farooq Mohammad travelled with two other people to Yemen in 2009 to meet Awlaki. They were unable to meet with Awlaki, so instead travelled to Sana’a, Yemen, to meet with one of his associates. Farooq Mohammad and his two fellow travelers gave the associate approximately $22,000 to be given to Awlaki, according to court documents. The money Farooq Mohammad provided included approximately $17,000 that had been provided by Asif and Sultane Salim in the United States. Ibrahim Mohammad facilitated the transfer of the money to Farooq Mohammad overseas for him to take to Awlaki in Yemen.
After law enforcement began investigating the financial transactions involved in the funds provided to Awlaki, Ibrahim Mohammad, Asif Salim and Sultane Salim attempted to conceal the source of the funds provided to Awlaki by lying to investigators and deleting emails from their accounts that were related to the transactions.
This case is being investigated by the FBI. This case is being prosecuted by Assistant U.S. Attorneys Matthew W. Shepherd and Michael J. Freeman of the Northern District of Ohio, and Trial Attorneys David Smith and Gregory Gonzalez of the National Security Division’s Counterterrorism Section.
The Woodlands Retina Center Settles Claim to Ensure Accessibility for People with DisabilitiesRead the Press Release
HOUSTON - The U.S. Attorney’s Office has resolved a claim that The Woodlands Retina Center violated the American with Disabilities Act (ADA) when it refused to treat a disabled patient because he was accompanied by a service animal, announced U.S. Attorney Ryan K. Patrick.
The United States initiated an investigation after receiving a complaint that alleged The Woodlands Retina Center discriminated against people with disabilities and denied equal access to medical services to people with disabilities who use service animals. The individual alleged The Woodlands Retina Center told him they had a “no dog policy” and refused to treat him because a service animal accompanied him during an eye appointment.
Under the ADA, persons with disabilities who are accompanied by their service animals shall be afforded the opportunity to participate in or benefit from the goods, services, facilities, privileges, advantages or accommodations equal to that afforded to other individuals. The government is authorized to commence a civil action when it is believed discrimination exists, seeking damages and full compliance with the ADA including requiring the owners and operators of places of public accommodations to make reasonable modifications to policies, practices and procedures.
Dr. Wael Abdelghani owns The Woodlands Retina Center, which is a professional office and a place of public accommodation under the ADA.
“This settlement resolves an allegation of discrimination based on disability,” said Patrick. “The announcement today should make clear that our medical professionals must provide reasonable accommodations to people with disabilities and that every member of our society is entitled to equal access to medical services.”
The settlement agreement requires The Woodlands Retina Center to adopt a service animal policy that will ensure it accepts and treats disabled patients accompanied by service animals.
The settlement agreement also requires The Woodlands Retina Center to pay the individual who made the claim compensatory damages.
Finally, the settlement agreement provides that the U.S. Attorney’s Office monitors the center to ensure it is meeting its obligations under the ADA.
Assistant U.S. Attorney Keith Edward Wyatt and Paralegal Specialist Raymond Babauta handled this matter on behalf of the U.S. Attorney’s Office.
Texas Woman Sentenced to Five Years in Prison after Previously Pleading Guilty to Interstate Travel for the Purpose of Engaging in Illicit Sexual Conduct with Fifteen-Year-Old Franklinton MinorRead the Press Release
U.S. Attorney Duane A. Evans announced that MARTHA OJEDA, age 42, of Pflugerville, Texas, was sentenced today by United States District Judge Jane Triche Milazzo to five years in prison followed by ten years of supervised release after previously pleading guilty to a one-count Bill of Information charging her with interstate travel with intent to engage in illicit sexual conduct. OJEDA will also have to register as a sex offender.
According to the court documents, in late February 2017, OJEDA met the minor, a fifteen-year-old boy who resided in Franklinton, Louisiana, on a social networking website. From late February until early April, OJEDA and the minor engaged in sexually explicit correspondence, including simulating sexual intercourse and other sexual contact and plans to engage in sexual acts in the future, on numerous occasions. During the correspondence, OJEDA requested and received sexually explicit images and videos of the minor via a social media-based instant messaging application.
In early April, OJEDA and the minor made plans for OJEDA to travel to Louisiana to pick up the minor and return to Texas together for the purpose of engaging in sex and spending the rest of their lives together. On about April 8, 2017, OJEDA traveled by commercial bus and then by taxi from Texas to the minor’s Franklinton, Louisiana home. OJEDA and the minor then traveled back to New Orleans, where they stayed in a hotel room together and engaged in sexual intercourse. On about April 9, 2017, OJEDA and the minor travelled via commercial bus from New Orleans, Louisiana, to Houston, Texas, for the purpose of engaging in living together in a romantic relationship. OJEDA and the minor then moved to Pflugerville, Texas, where they lived together until the minor was recovered by special agents with the Federal Bureau of Investigation on May 12, 2017.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case was investigated by agents from the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Jordan Ginsberg.
Ten Defendants Involved with Multi-State Identity Theft Ring Indicted for Credit Card Fraud and Money LaunderingRead the Press Release
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida; Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office; and Angel M. Melendez, Special Agent in Charge, ICE-HSI, New York Field Office, announce that a federal grand jury in the Southern District of Florida returned an indictment, on April 6, 2018, charging ten people with offenses including conspiracy to commit access device fraud (credit card fraud), trafficking in counterfeit access devices, use of one or more unauthorized access devices, possession of fifteen or more unauthorized access devices, aggravated identity theft, conspiracy to commit money laundering, and money laundering. This matter is assigned to United States District Court Judge Marcia G. Cooke (Case No. 18-CR-20269).
According to allegations in the indictment, Noe Reina De La Cruz, 27, of Doral, Florida; Raul Gil-Rodriguez, 35, of Paramus, New Jersey; Ney Antonio Lopez De La Cruz, 24, of Doral, Florida; Domingo Reyes, 40, of Doral, Florida; Yousef Michi, 34, of Brooklyn, New York; Esteban Ochoa, 34, of New York; Vantroy Sanchez, 39, of New York, New York; Jeffrey Batista, 27, of New York, New York; Carlos David Franco, 30, of Miami, Florida; and Pedro De La Cruz, 48, of Bronx, New York, used the personal identifying information of other individuals to open credit card accounts without the victims’ knowledge or consent. The conspirators used the fraudulently obtained credit cards to purchase electronics, home goods, expensive designer shoes, travel, spa services, and medical procedures for themselves and others. Some of the conspirators would also resell some of the fraudulently obtained goods, for a percentage of their face value, to Yousef Michi and Carlos David Franco, in order to obtain cash, checks, or wire transfers to Royal Elite Investments Corp., a shell company that Noe Reina De La Cruz controlled.
If convicted of the charged conduct the maximum possible sentences are as follows: conspiracy to commit access device fraud is 5 years in prison; conspiracy to commit money laundering is 20 years in prison; trafficking in counterfeit access devices is ten years in prison; use of one or more unauthorized access devices is ten years in prison; possession of fifteen or more unauthorized access devices is ten years in prison; and the aggravated identity theft charges carry a mandatory term of two years in prison, to run consecutive to the other crimes of conviction.
U.S. Attorney Greenberg commended the investigative efforts of ICE-HSI in this matter. This case is being prosecuted by Southern District of Florida Assistant U.S. Attorneys Lisa H. Miller and Nalina Sombuntham.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in a court of law.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Tartaglione Ordered to Forfeit More Than $2.4 Million from Fraud SchemeRead the Press Release
United States District Court Judge Joel H. Slomsky on Wednesday ordered Renee Tartaglione to forfeit $2.4 million in proceeds from her scheme to defraud the Juniata Community Mental Health Clinic. Tartaglione was convicted in June 2017, on all 53 counts of conspiracy, theft, fraud and tax evasion. Tartaglione siphoned some $2 million from the clinic of which she was president, and used some of that money to improve a building she owned that then appreciated in value.
“There’s a long list of victims in this case,” said U.S. Attorney William M. McSwain. “The economically disadvantaged served by the clinic deserved better. The guilty verdict, and now the Judge’s forfeiture order, bring a measure of justice for those victims.”
Judge Slomsky ordered the forfeiture to be paid from the proceeds from the sale of Tartaglione’s properties on 3rd Street and 5th Street in Philadelphia, as well as two homes at the New Jersey shore.
The case was prosecuted by Assistant U.S. Attorney Bea L. Witzleben and Department of Justice Trial Attorney Peter Halpern.
The 2016 indictment charged that Tartaglione purchased the building on 3rd Street in Philadelphia, which housed the clinic, and then raised the rent, repeatedly, causing the clinic’s rent for the building to increase from $4,500 per month to $25,000 per month.
Tartaglione’s company, Norris Hancock LLC, also purchased the building on 5th Street and, in December 2012, leased it to the clinic under a lease that called for rent of $35,000 per month for the first two years, and $75,000 per month for the next three years. The market rent for that building was $23,000 per month.
Tampa Man Pleads Guilty to Submitting False Claim for FEMA Benefits Related to Hurricane IrmaRead the Press Release
Tampa, Florida – Gregory A. Douglas, Jr. (40, Tampa) has pleaded guilty to submitting a false claim. He faces a maximum penalty of five years in federal prison. His sentencing hearing has not yet been set.
According to the plea agreement, after Hurricane Irma hit Florida in September 2017, Douglas used a false address in Tampa to apply for $1,514 in disaster assistance from the Federal Emergency Management Agency (“FEMA”). Douglas did not reside at or own a home at that address at the time of the storm. Nevertheless, in his application to FEMA, he falsely represented it to be his primary residence. Douglas also falsely represented that he had been displaced and that he had incurred expenses for temporary housing and critical needs assistance.
This case is part of the United States Attorney’s Disaster Fraud Task Force, which was announced in September 2017. The case was investigated by the U.S. Department of Homeland Security – Office of Inspector General. It is being prosecuted by Assistant United States Attorney Patrick Scruggs.
Members of the public who suspect fraud, waste, abuse, or allegations of mismanagement involving disaster relief operations, or believe they have been the victim of fraud from a person or organization soliciting relief funds on behalf of disaster victims, should contact the National Disaster Fraud Hotline toll free at (866) 720-5721. A live operator 24 hours a day, 7 days a week staffs the telephone line. You can also fax information to the Center at (225) 334-4707, or email it to [email protected]. You may also visit www.justice.gov/usao-mdfl.
TSA Employee Arrested and Charged with Attempted Production of Child PornographyRead the Press Release
A TSA employee appeared in federal court today to face child pornography charges.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and W. Howard Harrison, Chief Plantation Police Department, made the announcement.
Gary Linder, Jr., 27, of Ft. Lauderdale, was arrested and charged, by criminal complaint, with attempted production of child pornography and sending obscene material to a minor, in violation of, Title 18, United States Code, Sections 3351(a) and 1470. Linder had his initial appearance, today, before United States Magistrate Judge Lurana S. Snow. During the initial hearing, Linder was identified as a TSA employee. A detention hearing is scheduled in this matter for May 10, 2018, before United States Magistrate Judge Barry S. Seltzer.
According to the court docket, including the criminal complaint, in February of 2018, Linder initially began communicating with an eleven year old via text message. The phone was turned over to law enforcement, and over the course of several months Linder sent obscene material and discussed sexually explicit content with the individual he believed to be the minor child, via text message. On several occasions, Linder requested nude photos of the minor child engaged in sex acts.
Mr. Greenberg commended the investigative efforts of the FBI, including the FBI Miami Child Exploitation Task Force, and the Plantation Police Department. Mr. Greenberg also thanked the Coral Springs Police Department and Miramar Police Department for their assistance. This case is being prosecuted by Assistant U.S. Attorney Jodi L. Anton.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Stuart Man Sentenced to 57 Months for Possession of Firearm and AmmunitionRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Farris Dwayne Griffin, age 42, of Stuart, Oklahoma, was sentenced to 57 months imprisonment, and 3 years supervised release for Felon in Possession of Firearm and Ammunition, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(2). The charges arose from an investigation by the Pittsburg County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
The Indictment alleged that from on or about September 3, 2017 to on or about September 5, 2017, within the Eastern District of Oklahoma, the defendant, Farris Dwayne Griffin, having been convicted of a crime punishable by imprisonment for a term exceeding one year, did knowingly possess in and affecting commerce, a firearm and ammunition which had been shipped and transported in interstate commerce.
United States Attorney Brian J. Kuester said, “This office is committed to working with our federal, state, local and tribal partners to protect the public from violent offenders. Enforcement of the federal laws that prohibit convicted felons from possessing firearms is one way that we are able to protect the public. I commend the diligent and cooperative work of the Pittsburg County Sheriff’s Office, the Bureau of Alcohol, Tobacco, and Firearms, and members of the United States Attorney’s Office, for their work on this case and their commitment to public safety.”
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 Christopher Wilson represented the United States. The defendant will remain in custody pending transportation to the designated federal facility at which the non-paroleable sentence will be served.
Statement of U.S. Attorney John H. Durham on Selection of Robert M. Spector as U.S. Magistrate JudgeRead the Press Release
“Rob is an extraordinarily intelligent person and, without a doubt, one of the hardest working and most productive attorneys I’ve experienced in my 40 years as a prosecutor. His focus on prosecuting cases involving illegal drug distribution, firearm and violent crime offenses have had a significant impact in communities across our state. Most recently, through his tireless work in battling our opioid crisis, he has held numerous dealers who sold drugs that caused overdose deaths accountable, provided justice for overdose victims’ families, and spearheaded an outreach effort that has educated tens of thousands of students and adults about these horrific drugs. Our office is very sorry to lose him, but our loss is the U.S. District Court’s gain. He is a tremendous addition to the federal bench in Connecticut. I am extremely happy for him and wish him all the best.”
Click here to read the U.S. District Court press release.
South Florida Certified Public Accountant Indicted for Tax FraudRead the Press Release
A federal grand jury sitting in Miami, Florida, returned an indictment on Tuesday, Apr. 10 charging a Miami, Florida, certified public accountant with tax evasion, failing to file tax returns and failing to pay over payroll taxes to the Internal Revenue Service (IRS), announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida.
According to the indictment, Darryl Sharpton owned The Sharpton Group, a Miami-based public accounting firm that specialized in financial and management consulting, audit and attestation, and tax and wealth planning. Sharpton allegedly filed personal income tax returns for the years 2004 through 2008 and 2010, but failed to pay the reported taxes. Sharpton is further alleged to have failed to file personal income tax returns for years 2011 through 2016 despite his obligation to do so.
The indictment charges that after Sharpton failed to pay his taxes, the IRS audited and assessed additional taxes against him and issued levies and liens in further effort to collect the unpaid taxes. Sharpton allegedly responded by removing himself from his company’s payroll, paying his personal expenses through the corporate bank accounts, and lying to an IRS collections official.
In addition, the indictment alleges that Sharpton failed to timely pay over to the IRS payroll taxes that he withheld from the paychecks of The Sharpton Group’s employees.
If convicted, Sharpton faces a statutory maximum sentence of five years in prison for the tax evasion charge, five years in prison for each count of failing to pay over payroll taxes, and one year in prison for each count of failing to file tax returns. He also faces a period of supervised release, restitution and monetary penalties. An indictment merely alleges that a crime has been committed. A defendant is presumed innocent until proven guilty beyond a reasonable doubt.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Greenberg commended special agents of IRS Criminal Investigation, who investigated the case, and Assistant U.S. Attorney Christopher Clark and Tax Division Trial Attorneys Sean Beaty, Mara Strier, and Charles M. Edgar, Jr., who are prosecuting the case.
South Dakota Man Indicted for Assault ChargesRead the Press Release
United States Attorney Ron Parsons announced that a South Dakota man has been indicted by a federal grand jury for two counts of Assaulting, Resisting, and Impeding a Federal Officer.
Dayvon Sanchez, age 19, was indicted on February 14, 2018. He appeared before U.S. Magistrate Judge Mark A. Moreno on April 12, 2018, and pled not guilty to the Indictment.
The maximum penalty for each count upon conviction is up to 8 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on November 19, 2017, Sanchez, physically resisted and forcibly kicked multiple Rosebud Sioux Tribe law enforcement officers.
The charges are merely accusations and Sanchez is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Kirk Albertson is prosecuting the case.
Sanchez was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Solano County Man Sentenced to 11 Years in Prison for Drug and Firearms OffensesRead the Press Release
SACRAMENTO, Calif. — Maurice Antoine Jefferson, 50, of Vacaville, was sentenced today by U.S. District Judge Morrison C. England Jr. to 11 years in prison for possessing marijuana for distribution near a school zone, possessing cocaine for distribution, and possessing a firearm as a felon, U.S. Attorney McGregor W. Scott announced.
According to court documents, Jefferson was the sole proprietor of the Shredders Federation clothing store in Vacaville. He allegedly used the business as a cover to distribute marijuana and cocaine to high school students and others and as a front for money laundering. When agents executed a search warrant at the store in August 2016, they found 6.4 pounds of marijuana, 129 grams of cocaine, and other indicia of drug distribution. Jefferson was carrying a 9 mm pistol with him when Vacaville Police Officers arrived at the business. Jefferson has a felony conviction and is not allowed to possess any firearms.
In January 2018, Jefferson pleaded guilty to possessing marijuana with the intent to distribute it within 1,000 feet of the Will C. Wood High School in Vacaville. During the same hearing, Jefferson also pleaded guilty to possessing cocaine for distribution and possessing a firearm as a felon.
This case was the product of an investigation by the Vacaville Police Department and the Napa Special Investigations Bureau, with assistance from the Solano County District Attorney’s Office.
Six Defendants Charged with Collectively Trafficking over Four Hundred Migratory BirdsRead the Press Release
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida; Luis J. Santiago, Special Agent in Charge, United States Fish and Wildlife Service (USFWS), Office of Law Enforcement, Southeast Region; Alfredo Escanio, Major/Regional Commander, Florida Fish and Wildlife Conservation Commission (FWC), Division of Law Enforcement, South B Region; Martin G. Wade, Director, Customs and Border Protection (CBP) Air and Marine Operations, Miami Air and Marine Branch; Pedro Ramos, Superintendent, Everglades and Dry Tortugas National Parks (NPS); and Antonio J. Gomez, Postal Inspector in Charge, United States Postal Inspection Service (USPIS), Miami Division, announce the filing of federal charges against 6 defendants in 6 separate cases for their involvement with the trafficking of over 400 migratory birds.
In 1918, Congress enacted the Migratory Bird Treaty Act (MBTA) for the protection of migratory birds. Now in its 100th year, the MBTA prohibits, inter alia, the pursuit, hunting, taking, capture, killing, possession, sale, barter, purchase, shipping, exportation, and importation of migratory birds. Migratory birds are listed at Title 50, Code of Federal Regulation, Section 10.13.
Working independently and separately from each other, these six charged defendants used sophisticated methods to traffic protected wildlife, specifically migratory birds. The methods included bird traps augmented by electronic birdcall broadcast systems powered with solar panels and rechargeable batteries; baited bird traps spread throughout the region as collection points; the erection of mist nets at one end of a field during migration season and the operation of a truck from the other end of the field to flush hundreds of migratory birds into the mist nets; the strategic deployment of specially formulated adhesives to glue migratory birds to tree limbs and sticks; and the hunting of migratory birds, in particular the illegal hunting of raptors with rifles. They also used traditional smuggling techniques to unlawfully transport the captured wildlife. These techniques included the shipment of migratory birds to buyers across the country in boxes with hidden compartments; the use of a false name and address on airmail shipments; false statements on customs declarations; and the concealment of the protected wildlife in hair curlers taped to a defendant’s body, beneath baggy pants.
In some instances, the wildlife trafficking in these cases involved severe animal cruelty and resulted in injury to the birds. Some of the trafficked birds showed signs of having sustained injuries while attempting to flee captivity. Some of the birds, specifically some of the hawks, were actually dead at the time of sale and other birds died shortly after purchase. One defendant left the captured birds entangled in netting, where they were preyed upon by wild dogs and cats. Another defendant maimed some of the migratory birds by ripping out their tail feathers. A third defendant, believing that a Loggerhead Shrike (Lanius ludovicianus) was a threat to his inventory of migratory birds for sale, threw the animal against a wall and affixed it to a wooden cross. The defendant filmed this activity and uploaded the images onto a private internet chat group that he used to advertise migratory birds for sale.
In the course of these investigations, undercover USFWS and FWC agents purchased and/or seized migratory birds from all six of these defendants. After a determination that the release of the seized wildlife is safe and appropriate, USFWS will return hundreds of these birds into the wild.
“The U.S. Attorney’s Office stands alongside our law enforcement and community partners as we strive to protect our natural resources and wildlife, including the diverse migratory bird population, that make South Florida such a vibrant environmental sanctuary,” stated U.S. Attorney Benjamin G. Greenberg. “Today’s announcement reinforces our continued commitment to the federal prosecution of individuals who pose a threat to our nation’s wildlife, in particular our protected bird species.”
"The 100th anniversary of the Migratory Birds Treaty Act is a good time to remind Americans of the benefits we all enjoy from a land that is rich in birds and all wildlife,” said Special Agent in Charge Luis Santiago, USFWS Southeast Region’s Office of Law Enforcement. “Our work enforcing this law and others recognizes the value Americans place on wildlife, and it is important to make sure that future generations can enjoy these as well.”
“We are honored to have been a part of these important enforcement efforts,” stated Major Alfredo Escanio, FWC Regional Commander. “We want to get the word out that these birds are protected, and ask the public to let us know if they see anyone trying to trap or sell these birds.”
“As fellow aviators, we at CBP Air and Marine Operations (AMO) were particularly excited to participate in this case, to help set these ‘ornery’ birds free to fly again. AMO uses its specialized capabilities to serve and protect the American people. That includes working with our partners to enforce hundreds of U.S. laws, including the 1918 Migratory Bird Treaty Act,” said Jeff Maher, Deputy Director, CBP Air Operations at the Miami Air and Marine Branch.
"The American people are investing billions of dollars to restore the Everglades and this kind of illegal poaching activity cannot be tolerated,” stated NPS Superintendent Pedro Ramos. “I am grateful to all of our partner agencies, the investigators, and the Department of Justice professionals who have worked on these important cases. Through their hard work, not only are we able to protect important species of birds, but also protect the investments being made in Everglades restoration ultimately for the benefit of future generations."
“As shown through this announcement, violations of the Migratory Bird Treaty threaten the livelihood of innocent animals,” said Antonio J. Gomez, Inspector in Charge, USPIS Miami Division. “This case demonstrates that the U.S. Postal Inspection Service will continue to work tirelessly with our partners to enforce all federal laws that are in place to protect U.S. residents and wildlife. We are proud that our collaborative efforts were successful in bringing justice to the animals horrifically harmed and removed from their natural habitats.”
Today’s announcement reaffirms the collective commitment of federal, state and local authorities to the prosecution of wildlife traffickers. The cases brought under this operation include:
- United States v. Juan Carlos Rodriguez, a/k/a “El Doctor,”
Case No. 18-CR-20141-MOORE
On March 1, 2018, Juan Carlos Rodriguez, 54, of Homestead, was charged in an eighteen-count indictment with selling, offering for sale, bartering, and offering to barter migratory birds.
According to the indictment, between May 2014 and November 2016, Rodriguez trafficked in migratory birds, including Puerto Rican Spindalises (Spindalis portoricensis), Northern Cardinals (Cardinalis cardinalis), Puerto Rican Bullfinches (Loxigilla portoricensis), Yellow-faced Grassquits (Tiaris olivaceus), Blue Grosbeaks (Passerina caerulea), Indigo Buntings (Passerina cyanea), Cooper’s Hawks (Accipiter cooperii), Bobolinks (Dolichonyx oryzivorus), Red-shouldered Hawks (Buteo lineatus), Gray Catbirds (Dumetella carolinensis), Painted Buntings (Passerina ciris), Summer Tanagers (Piranga rubra), Screech-Owls (genus Megascops), and Sharp-shinned Hawks (Accipiter striatus).
Mr. Greenberg commended the investigative efforts of the USFWS, FWC, CBP, CBP Air and Marine Operations and USPIS in this matter. This case is being prosecuted by Assistant U.S. Attorney Jaime Raich.
- United States v. Miguel Loureiro, Case No. 18-CR-20164-MARTINEZ
On March 8, 2018, Miguel Loureiro, 27, of Homestead, was charged in a thirty-six-count indictment for participating in a conspiracy to take migratory birds for commercial purposes, selling and offering migratory birds for sale, and taking migratory birds.
According to the allegations contained in the indictment, beginning in January 2016 and ending in December 2017, Loureiro and a co-conspirator trafficked in migratory birds, including Indigo Buntings (Passerina cyanea), Blue Grosbeaks (Passerina caerulea), Rose-breasted Grosbeaks (Pheucticus ludovicianus), Painted Buntings (Passerina ciris), White-crowned Sparrows (Zonotrichia leucophrys), Clay-colored Sparrows (Spizella palida), and Grasshopper Sparrows (Ammodramus savannarum).Mr. Greenberg commended the investigative efforts of the USFWS, FWC, and NPS. This case is being prosecuted by Assistant U.S. Attorney Jaime Raich.
- United States v. Hovary Muniz, Case No. 18-MJ-2496-SIMONTON
On April 3, 2018, Hovary Muniz, 42, of Miami, was charged by criminal complaint with knowingly selling and offering migratory birds for sale.
According to the criminal complaint, Muniz pled guilty in 2016 to smuggling migratory birds from Cuba into the United States in a fanny pack. In 2017 and 2018, while on probation for the wildlife trafficking offense, Muniz offered Yellow-faced Grassquits (Tiaris olivacea), a Lazuli Bunting (Passerina amoena), and other migratory birds for sale.
Mr. Greenberg commended the investigative efforts of the USFWS and CBP in this matter. This case is being prosecuted by Assistant U.S. Attorneys Jaime Raich and Tom Watts-FitzGerald.
- United States v. Corbo Martinez, Case No. 17-CR-20596-WILLIAMS
On August 24, 2017, Alberto Iran Corbo Martinez, 38, of Hialeah, was charged in a three-count indictment with smuggling goods into the United States and using a false document.
According to the indictment, Corbo Martinez imported Cuban Bullfinches (Melopyrrha nigra) and a Yellow-faced Grassquit (Tiaris olivaceous) from Cuba. He concealed those importations by hiding the birds in hair curlers taped to his legs, beneath baggy pants, and by making false declarations on customs forms.
Mr. Greenberg commends the investigative efforts of the USFWS and CBP in this matter. This case is being prosecuted by Assistant U.S. Attorney Tom Watts-FitzGerald.
- United States v. Reynaldo Mederos, Case No. 18-CR-20140-LENARD
On March 1, 2018, Reynaldo Mederos, 28, of Miami, was charged in a seven-count indictment with selling and offering to sell migratory birds.
According to the indictment and publicly available documents, beginning in July 2016 and ending in November 16, 2017, Mederos trafficked in migratory birds, including Indigo Buntings (Passerina cyanea), Painted Buntings (Passerina ciris), and Blue Grosbeaks (Passerina caerulea).
Mr. Greenberg commended the investigative efforts of the USFWS in this matter. This case is being prosecuted by Assistant U.S. Attorney Jaime Raich.
- United States v. Carlos Hernandez, Case No. 17-CR-20759-MARTINEZ
On October 26, 2017, Carlos Hernandez, 34, of Miami, was charged in a six-count indictment with trapping, selling, and offering to sell migratory birds.
According to the indictment and publicly available documents, beginning in January 2016 and ending in April 2017, Hernandez trapped and trafficked in migratory birds, including Blue Grosbeaks (Passerina caerulea).
Mr. Greenberg commended the investigative efforts of the USFWS and FWC in this matter. This case is being prosecuted by Assistant U.S. Attorney Jaime Raich.
If convicted of the charged conduct, the defendants each face a possible maximum statutory sentence of 5 years in prison for the conspiracy charges and 2 years in prison for trafficking in migratory birds, in violation of the Migratory Bird Treaty Act.
An indictment or a criminal complaint is an accusatory instrument that contains formal charges against a defendant. All persons charged in an indictment or criminal complaint are presumed innocent, unless and until proven guilty in a court of law.
The public is encouraged to report any instances of illegal wildlife trapping and trafficking to the Florida Fish and Wildlife Conservation Commission (FWC) at 888-404-3922 or by email or text to [email protected].
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
- United States v. Juan Carlos Rodriguez, a/k/a “El Doctor,”
Silver Spring Man Sentenced to 20 Years in Prison for Distribution of Child PornographyRead the Press Release
FOR IMMEDIATE RELEASE Contact ELIZABETH MORSE
www.justice.gov/usao/md at (410) 209-4885
Greenbelt, Maryland – United States District Judge Paula Xinis sentenced Kevin Heiting, age 30, of Silver Spring, Maryland today to 20 years in prison, followed by a lifetime of supervised release, for distribution of child pornography and other admitted conduct detailed in his plea agreement.
The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).
This case began as a lead to HSI from the Swiss Cybercrime Coordination Unit of the Swiss Federal Police regarding an individual distributing child pornography using a Virtual Private Network based in Switzerland.
On May 19, 2016, based in part on the Swiss investigative lead, a federal search warrant was executed at Heiting’s residence in Silver Spring, Maryland, and law enforcement seized five hard drives, two laptop computers, a tower computer, and a cellular telephone. A forensic analysis of just one of the seized hard drives revealed more than 17,913 video files and 405,071 image files, many of which depicted children, including infants and toddlers, engaged in sexually explicit conduct. A file-sharing program found on Heiting’s computer revealed that Heiting shared over 100,000 files between June 8, 2014 and January 6, 2015. The analysis revealed that thousands of users connected to one of Heiting’s laptop computers and downloaded files. The analysis further showed that Heiting both received and distributed child pornography using the laptop computer.
The same afternoon that the search warrant was executed, Heiting purchased a new laptop computer. On August 4, 2016, Heiting traveled from Maryland to Central America with the laptop, which Heiting was using to run a file sharing program and to conduct online chats with minors. On Heiting’s return from Central America, the laptop was detained by officers from U.S. Customs and Border Protection and subsequently forensically examined. The analysis revealed that in addition to sharing and downloading child pornography, Heiting was communicating with a 14-year-old boy over the “dark web” using an encrypted web chat application. Enticed and persuaded by Heiting, the victim sent Heiting images of himself engaged in sexually explicit conduct.
On August 29, 2016, Heiting was indicted on federal child pornography charges and placed on pretrial release, with conditions which forbade Heiting from possessing Internet capable devices. On February 1, 2017, law enforcement agents executed a search warrant at Heiting’s residence and recovered a laptop computer, two 5TB hard drives, and three USB thumb drives that had been hidden by Heiting in an air purifier cabinet. An initial forensic review of the laptop revealed that it contained a file-sharing program and the encrypted “dark web” application that Heiting had previously used. The laptop computer had last been accessed the very morning the search warrant was executed.
Heiting will be required to register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
A hearing will be held in July 2018 to determine the amount of restitution to be paid to child pornography victims.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorney’s Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Robert K. Hur commended HSI Baltimore, the Montgomery County Police Department, the Maryland State Police Internet Crimes Against Children Task Force, and U.S. Customs and Border Protection – Atlanta for their work in the investigation, and the Swiss Federal Police for their assistance. Mr. Hur thanked Assistant U.S. Attorney Joseph R. Baldwin and Special Assistant U.S. Attorney Julie Finocchiaro, who prosecuted the case.
Shreveport man sentenced to 30 months in prison for illegally possessing a revolverRead the Press Release
SHREVEPORT, La. – United States Attorney David C. Joseph announced that a Shreveport felon was sentenced Tuesday to 30 months in prison for possessing a revolver.
Christopher Deshun Owens, 28, of Shreveport, was sentenced by U.S. District Judge S. Maurice Hicks Jr. on one count of possession of a firearm by a convicted felon. He was also sentenced to three years of supervised release. According to the December 13, 2017 guilty plea, Shreveport 911 operators received a call on August 10, 2017 from Owens’ ex-girlfriend. They heard the ex-girlfriend and Owens arguing about a firearm. Owens had entered the ex-girlfriend’s home with a firearm. Police later arrived and detained Owens. A Charter 2000, Shelton, Conn., Model: Undercover, Caliber .38 SPL revolver was recovered from a child’s dresser drawer in the house. Owens initially denied carrying the gun but later admitted to it. Owens was previously convicted in Bossier Parish for possession of marijuana, second offense.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safe for everyone. Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.
The ATF and Shreveport Police Department conducted the investigation. Assistant U.S. Attorney Tiffany E. Fields prosecuted the case.
Seminole Man Sentenced to 77 Months for Methamphetamine DistributionRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Rodney Phillip Aird, age 50, of Seminole, Oklahoma, was sentenced to 77 months imprisonment, and 4 years supervised release for Possession With Intent To Distribute Methamphetamine, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(B). The charges arose from an investigation by the Seminole Nation Tribal Police and the Drug Enforcement Administration.
The Indictment alleged that on or about August 13, 2017, within the Eastern District of Oklahoma, the defendant, Rodney Phillip Aird, did knowingly and intentionally possess with the intent to distribute 5 grams or more of methamphetamine (actual), a Schedule II controlled substance.
United States Attorney Brian J. Kuester said, “No one can deny the horrendous impact that methamphetamine has had on our communities. Those people who distribute it must be stopped and held accountable for their unlawful actions. I commend the members of the Seminole Nation Tribal Police, DEA and United States Attorney’s Office for their diligent work and cooperative efforts to combat the sale of dangerous drugs.”
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 John David Luton represented the United States. The defendant will remain in custody pending transportation to the designated federal facility at which the non-paroleable sentence will be served.
Seligman Man Sentenced for MethRead the Press Release
SPRINGFIELD, Mo. – A Seligman, Mo., man has been sentenced in federal court for possessing methamphetamine to distribute following a high-speed pursuit by law enforcement officers that ended at a chicken farm.
Jeffery B. Stout, 37, of Seligman, was sentenced by U.S. District Judge Stephen R. Bough on Tuesday, April 10, 2018, to seven years in federal prison without parole.
On Dec. 13, 2017, Stout pleaded guilty to possession of methamphetamine with the intent to distribute.
Stout was arrested on July 7, 2016, following a high-speed pursuit by law enforcement officers. A Barry County sheriff’s deputy attempted to stop Stout, who had been reported driving a red Camaro on the wrong side of the road, after the vehicle’s license plates did not match. Stout led officers on a chase with speeds up to 102 miles per hour. Stout eventually stopped after he entered a chicken farm, drove into a field, lost control, and spun out the wheels. As the wheels were spinning, officers blocked Stout from pulling forward and pulled Stout and a passenger out of the vehicle.
Officers searched the vehicle and found a Jack Daniels tin can that contained 24.6 grams of pure methamphetamine, seven baggies that contained methamphetamine, four baggies that contained methamphetamine residue, more than $1,000 in cash, various drug paraphernalia and a sparkler bomb device.
Stout has committed seven drug offenses since 2002. Those convictions started with a municipal conviction with a suspended sentence in 2002. He then went to prison for drugs in 2008 in Arkansas. In 2013, he was convicted again for drugs in Missouri, where he was put in a drug court program. His probation was then revoked concurrent to a new drug conviction in 2014 and he was sent to the 120-day treatment program in the Missouri Department of Corrections. He was discharged from probation on April 13, 2016, less than three months before the events of this case.
Stout also has a prior conviction for aggravated assault on a family member, where he pointed a shotgun at his live-in girlfriend during an argument and threatened her. He has eight prior convictions for driving without a valid license, along with prior convictions for failure to appear in court, trespassing, leaving the scene of an accident, criminal contempt and resisting arrest.
This case was prosecuted by Special Assistant U.S. Attorney Jody Larison. It was investigated by the Barry County, Mo., Sheriff’s Department, the Missouri State Highway Patrol and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Seattle Area Man Sentenced to 33 Years in Prison for Sex Trafficking Teens and Young WomenRead the Press Release
David D. Delay, 52, of Lynnwood, Washington, was sentenced today in a U.S. District Court in Seattle to 33 years in prison for his predatory and exploitive scheme to recruit young women and teens to prostitution for his own enrichment, announced Acting Assistant Attorney General John Gore of the Justice Department’s Civil Rights Division, U.S. Attorney Annette L. Hayes of the Western District of Washington, and Special Agent in Charge Jay S. Tabb, Jr. of the FBI’s Seattle Field Office. Delay was also ordered to pay $76,700 in restitution to his victims, plus additional costs for counseling and medical care. Following prison Delay must register as a sex offender and will be on supervised release for the rest of his life. Because Delay has continued to harass his victims on social media, the judge requested the prison system and U.S. Probation limit his access to social media and computers. At today’s sentencing hearing U.S. District Judge Robert S. Lasnik said “He deserves a long sentence and a sentence that sends a message to the community that these crimes will not be tolerated.”
At the conclusion of a ten-day trial, the jury convicted the defendant on Nov. 6, 2017, of 17 federal felonies, including one count of conspiracy to engage in sex trafficking by force, fraud, and coercion; three counts of sex trafficking; three counts of attempted sex trafficking; one count of conspiracy to transport individuals for purposes of prostitution; six counts of transporting individuals for purposes of prostitution; two counts of production of child pornography; and one count of obstruction of justice.
According to evidence presented in court, including the testimony of seven victims, the defendant targeted vulnerable teenagers and young women in their early 20s by claiming to be a famous film producer with a multi-million dollar contract from HBO to produce a documentary on prostitution. Delay enticed his victims, several of whom he convinced to travel across the country to be with him, into working for him as prostitutes by falsely claiming that they would make up to $20 million by participating in his documentary. In order to convince the victims that his assertions were true, Delay sent them falsified bank account screenshots supposedly depicting the profits of his other films, a photograph of himself outside of an HBO office, and seemingly official, binding contracts that he asked them to sign that obligated them to pay him over a thousand dollars per week in prostitution proceeds. Delay falsely promised some of his victims that he was negotiating for them to star in a reality television show produced by Ryan Seacrest. Representatives from HBO and Ryan Seacrest Productions testified that the companies did not have any business dealings with Delay.
Once the victims arrived in Seattle, the defendant coerced them into prostituting themselves for his profit. He manipulated them emotionally, psychologically, and sexually; isolated them; made them completely dependent on him; and in some instances threatened legal action against them, falsely claiming that the victims had violated their contracts and were subject to civil penalties. In furtherance of his sex trafficking scheme, the defendant also enticed two minor victims to produce graphic pornographic photographs and videos for him, and in two instances threatened to release sexually explicit video images of his victims unless they complied with his demands.
“Delay used fraud and fear against vulnerable young women and girls to coerce them into commercial sex, turning them into sexual commodities for his own profit,” said Acting Assistant Attorney General John Gore of the Civil Rights Division. “The Department of Justice will continue to vigorously pursue sex traffickers and today’s sentence is an example of our ongoing efforts to hold traffickers accountable for their horrific crimes and vindicate the rights of their victims.”
“The long prison sentence imposed in this case is just punishment for the devastating impact this defendant had on his victims,” said U.S. Attorney Hayes. “As they bravely testified in court, the defendant’s conduct left his victims with deep and lasting emotional scars. There simply is no place in civilized society for the kind of sexual exploitation that this defendant engaged in without so much as a second thought.”
“The FBI remains committed to working with federal, state and local partners to combat such egregious criminal activities " said Special Agent in Charge Jay Tabb, of the FBI’s Seattle Field Office. “In this case, the FBI worked closely with the Redmond Police Department and the US Attorney’s Office to get survivors the help they need, and traffickers the justice they deserve. Given the complexity of Mr. Delay’s criminal schemes, our team included multiple experts all working as part of the Child Exploitation Task Force, a unit which continues to identify other victims and predators so we can disrupt cycles of abuse. ”
“We are proud of the excellent work done by the Redmond Police in partnership with the FBI,” said Redmond Police Chief K. Wilson. “Our close working relationship with our law enforcement partners through the FBI taskforce, allowed us to bring the needed resources to bear to ensure the defendant was arrested and convicted of his crimes.”
Co-defendant Marysa Comer, 23, of Matthews, North Carolina, previously pleaded guilty on Nov. 16, 2015, to one count of conspiracy to commit sex trafficking for her role in Delay’s scheme. She was sentenced to 36 months in prison on Dec. 1, 2017.
The case was investigated by the FBI’s Seattle Field Office and the Redmond Police Department, along with assistance from the FBI’s Chicago Field Office, the King County Sheriff’s Office, the King County Prosecuting Attorney's Office, the Beaverton, Oregon Police Department, and the Bureau of Prisons. The case was prosecuted by Assistant U.S. Attorney Kate Crisham and Trial Attorney Matthew Grady of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Seattle Area Man Sentenced to 33 Years in Prison for Sex Trafficking Teens and Young WomenRead the Press Release
A 52-year old Lynnwood, Washington man was sentenced today in U.S. District Court in Seattle to 33 years in prison for his predatory and exploitive scheme to recruit young women and teens to prostitution for his own enrichment, announced U.S. Attorney Annette L. Hayes. DAVID D. DELAY was convicted of 17 federal felonies following a ten-day jury trial in November 2017. At today’s sentencing hearing U.S. District Judge Robert S. Lasnik said “He deserves a long sentence and a sentence that sends a message to the community that these crimes will not be tolerated.”
“The long prison sentence imposed in this case is just punishment for the devastating impact this defendant had on his victims,” said U.S. Attorney Hayes “As they bravely testified in court, the defendant’s conduct left his victims with deep and lasting emotional scars. There simply is no place in civilized society for the kind of sexual exploitation that this defendant engaged in without so much as a second thought.”
“Delay used fraud and fear against vulnerable young women and girls to coerce them into commercial sex, turning them into sexual commodities for his own profit,” said Acting Attorney General John Gore of the Civil Rights Division. “The Department of Justice will continue to vigorously pursue sex traffickers and today’s sentence is an example of our ongoing efforts to hold traffickers accountable for their horrific crimes and vindicate the rights of their victims.”
According to evidence presented in court, including the testimony of seven victims, the defendant targeted vulnerable teenagers and young women in their early 20s by claiming to be a famous film producer with a multi-million dollar contract from HBO to produce a documentary on prostitution. Delay enticed his victims, several of whom he convinced to travel across the country to be with him, into working for him as prostitutes by falsely claiming that they would make up to $20 million by participating in his documentary. In order to convince the victims that his assertions were true, DELAY sent them falsified bank account screenshots supposedly depicting the profits of his other films, a photograph of himself outside of an HBO office, and seemingly official, binding contracts that he asked them to sign that obligated them to pay him over a thousand dollars per week in prostitution proceeds. DELAY falsely promised some of his victims that he was negotiating for them to star in a reality television show produced by Ryan Seacrest. Representatives from HBO and Ryan Seacrest Productions testified that the companies did not have any business dealings with DELAY.
Once the victims arrived in Seattle, the defendant coerced them into prostituting themselves for his profit. He manipulated them emotionally, psychologically, and sexually; isolated them; made them completely dependent on him; and in some instances threatened legal action against them, falsely claiming that the victims had violated their contracts and were subject to civil penalties. In furtherance of his sex trafficking scheme, the defendant also enticed two minor victims to produce graphic pornographic photographs and videos for him, and in two instances threatened to release sexually explicit video images of his victims unless they complied with his demands.
“The FBI remains committed to working with federal, state and local partners to combat such egregious criminal activities " said Special Agent in Charge Jay Tabb, of the FBI’s Seattle Field Office. “In this case, the FBI worked closely with the Redmond Police Department and the US Attorney’s Office to get survivors the help they need, and traffickers the justice they deserve. Given the complexity of Mr. Delay’s criminal schemes, our team included multiple experts all working as part of the Child Exploitation Task Force, a unit which continues to identify other victims and predators so we can disrupt cycles of abuse. ”
“We are proud of the excellent work done by the Redmond Police in partnership with the FBI. Our close working relationship with our law enforcement partners allowed us to bring the needed resources to bear to ensure the defendant was arrested and convicted of his crimes,” said Redmond Police Chief K. Wilson.
Judge Lasnik ordered DELAY to pay $76,700 in restitution to his victims, plus additional costs for counseling and medical care. Following prison DELAY must register as a sex offender and will be on supervised release for the rest of his life. Because DELAY has continued to harass his victims on social media, the judge requested the prison system and U.S. Probation limit his access to social media and computers.
Co-defendant Marysa Comer, 23, of Matthews, North Carolina, previously pleaded guilty on November 16, 2015, to one count of conspiracy to commit sex trafficking for her role in Delay’s scheme. She was sentenced to 36 months in prison on December 1, 2017.
The case was investigated by the FBI’s Seattle Field Office and the Redmond Police Department, along with assistance from the FBI’s Chicago Field Office, the King County Sheriff’s Office, the King County Prosecuting Attorney's Office, the Beaverton, Oregon Police Department, and the Bureau of Prisons. The case was prosecuted by Assistant U.S. Attorney Kate Crisham and Trial Attorney Matthew Grady of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Sacramento Man Charged with Firearm Offenses and Possession of MethamphetamineRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a two-count indictment today against John Allan Trotter, 36, of Sacramento, charging him with possession of a firearm in furtherance of a drug trafficking offense and possession with intent to distribute methamphetamine, U.S. Attorney McGregor W. Scott announced.
According to court documents, on February 8, 2018, Trotter was arrested after leading Sacramento County Sheriff’s detectives on a high-speed chase. Trotter crashed his car and ran from law enforcement officers before being apprehended. Trotter had a loaded gun, methamphetamine, and scale in his car at the time of the crash.
This case is the product of an investigation by the Sacramento County Sheriff’s Department, Sacramento County District Attorney’s Office, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Justin Lee is prosecuting the case.
If convicted of possession of a firearm in furtherance of a drug trafficking offense, Trotter faces a mandatory minimum statutory penalty of five years in prison and up to life in prison and a $250,000 fine. If convicted of possession with intent to distribute methamphetamine, he faces a penalty of 20 years in prison and a $1 million fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone.
Rotech Agrees to Pay $9.68 Million to Settle False Claims Act Liability Related to Improper Billing for Portable OxygenRead the Press Release
The Justice Department announced today that Rotech Healthcare Inc., a Florida-based respiratory equipment supplier, has agreed to pay $9.68 million for knowingly submitting false claims for portable oxygen contents to Medicare. As part of the settlement, Rotech admitted that it knowingly billed portable oxygen contents to Medicare for beneficiaries who did not use or require them. The Company further admitted to billing Medicare regardless of whether such contents were delivered.
“This settlement serves as a warning to suppliers who bill first and ask questions later,” said Acting Assistant Attorney General Chad A. Readler, head of the Justice Department’s Civil Division. “We will investigate and take action against companies who cut corners and place profits over compliance with Medicare’s billing requirements.”
Medicare covers rentals of portable and stationary oxygen equipment for up to 36 months and allows suppliers to bill monthly for oxygen to be used with that equipment for up to 24 additional months after the rental period. Between January 2009 and March 2012, Rotech automatically billed Medicare for portable oxygen contents for all Medicare beneficiaries after the 36-month rental period, without verifying that the beneficiaries used or needed portable oxygen, and without obtaining the requisite proof of delivery. Rotech continued this practice despite knowing that it resulted in the submission of claims for portable oxygen contents that were ineligible for reimbursement.
“Many people believe that healthcare fraud is a victimless crime; I assure you it is not,” said United States Attorney Joseph D. Brown of the Eastern District of Texas. “Medicare is funded largely by you and me, the American taxpayers, and fraud contributes to runaway health care costs. I commend the whistleblower who had the courage to come forward and who worked with investigators to get to the bottom of this case. Because of her, we were able to recoup millions of dollars improperly paid to Rotech.”
The allegations resolved by this settlement arose from a whistleblower lawsuit filed under the False Claims Act by Janet Hale, a former employee in Rotech’s billing department. Under the False Claims Act, private citizens can sue on behalf of the government and share in any recovery. Ms. Hale will receive $1,645,600.
The settlement was the result of a coordinated effort by the Civil Division’s Commercial Litigation Branch, the United States Attorney’s Office for the Eastern District of Texas, the Federal Bureau of Investigation, the Department of Health and Human Services Office of Inspector General, and the Texas Office of the Attorney General – Medicaid Fraud Control Unit.
The case is captioned United States ex rel. Hale v. Rotech Healthcare Inc., 4:14-cv-545 (E.D. Tex.).
Rocklin Man Sentenced for Mortgage Fraud SchemeRead the Press Release
SACRAMENTO, Calif. — Aleksandr Kovalev, 54, of Rocklin, was sentenced today by U.S. District Judge Morrison C. England Jr. to three years and 10 months in prison for wire fraud involving financial institutions, U.S. Attorney McGregor W. Scott announced.
According to court documents, Kovalev was in the business of developing, building and selling real property in Sacramento, Fairfield, and Stockton. As the real estate market began to weaken, Kovalev offered to make incentive payments to purchasers, through “down payment assistance” or by making other payments to the buyers to be used in whatever manner the buyers wanted. Most of the payments to the buyers were out of escrow and were often paid through intermediaries, originating in Kovalev’s bank account. These payments were not disclosed to the lenders, and had the effect of substantially reducing the sales price below what was represented to the lenders.
Dozens of properties were involved in Kovalev’s mortgage fraud scheme, with several million dollars of losses to the lenders. Kovalev is the last to be sentenced out of nine individuals who were prosecuted as part of this mortgage fraud scheme.
This case was the product of an investigation by the Federal Bureau of Investigation and the IRS Criminal Investigation. Assistant U.S. Attorney Todd A. Pickles prosecuted the case.
Rochester Man Pleads Guilty to Child Pornography ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y. - U.S. Attorney James P. Kennedy Jr. announced today that Michael Krepp, 57, of Rochester, NY, pleaded guilty to possession of child pornography before U.S. District Judge Charles J. Sirgusa. The charge carries a mandatory minimum penalty of 120 months in prison and a maximum penalty of 240 months.
Assistant U.S. Attorney John J. Field, who is handling the case, stated that between September 9, 2017, and January 22, 2018, an FBI Special Agent, working undercover, discovered multiple files containing videos and images of child pornography. Some of the videos and images depicted prepubescent children in sexual situations. Investigators determined that the IP address connected to the files resolved to one utilized by the defendant. Digital media recovered from Krepp in February 2018 contained child pornography.
The defendant was previously convicted of Rape 3rd in State Court and is a registered sex offender.
The plea is the result of an investigation by the Federal Bureau of Investigation, Buffalo Division, under the direction of Acting Special Agent-in-Charge Kevin P. Lyons.
Sentencing is scheduled for July 12, 2018 before Judge Siragusa.
River Ridge Man Charged with Stealing over $1,000,000 from EmployerRead the Press Release
U.S. Attorney Duane A. Evans announced that DON MANUEL ZEMO, JR., age 55, a resident of River Ridge, Louisiana, was charged yesterday in a one-count bill of information with conspiracy to commit mail fraud, in violation of 18 U.S.C. ' 371, for his role in stealing over $1,000,000 from his employer, a privately owned and operated company that provided portside services as a terminal operator and stevedore at the Port of New Orleans.
According to the bill of information, ZEMO was hired in 1999. Between 2003 and 2015, he served as the General Manager of Port Operations. In that capacity, ZEMO oversaw and managed Company A’s day-to-day operations at Company A’s terminal at the Port of New Orleans, including handling all financial documentation, personnel decisions, job scheduling, implementing of Company A’s policies at Company A’s Port of New Orleans terminal, and facilitating the billing of Company A’s customers.
In about August 2009, R.Z. formed U.S. Gulf Trade, Inc., and until July 2015, ZEMO diverted approximately $1,033,639.54 over the course of eighty (80) transactions from Company A to himself and U.S. Gulf Trade. ZEMO did so by representing to Company A’s customers that USGT, and not Company A, had provided certain services and material to the customer when, in fact, Company A’s equipment, employees, and material was used to provide the services and directing customers to transmit payments to USGT, not Company A, for the services rendered and material provided, without Company A’s knowledge or authorization..
If convicted, ZEMO faces a maximum term of imprisonment of five years, a fine of up to $250,000.00, three years supervised release after imprisonment, and a mandatory $100 special assessment.
U. S. Attorney Evans reiterated that a bill of information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Evans praised the work of the Internal Revenue Service – Criminal Investigations. Assistant United States Attorney Jordan Ginsberg is in charge of the prosecution.
Registered Sex Offender Heads to Prison…AgainRead the Press Release
HOUSTON – A 45-year-old Porter man has again been sent to prison, this time for three federal charges to include distribution, receipt and possession of child pornography, announced U.S. Attorney Ryan K. Patrick. Eric Furzland is a sex offender who has been required to register since his conviction for indecency with a child in 1997 in Harris County. He pleaded guilty Oct. 12, 2017.
Today, U.S. District Judge Alfred H. Bennett sentenced Furzland to a total of 288 months in federal prison. He will also serve 20 years on supervised release following completion of his prison term, during which time he will have to comply with numerous requirements designed to restrict his access to children and the internet. Furzland will also again be ordered to register as a sex offender.
Authorities believed Furzland was uploading and storing child pornography into a virtual storage account. He had been using a variety of online applications to chat with others about child pornography and trade materials. He later posted such materials to a cloud storage service and made the link to his account available to at least one other person.
Law enforcement executed a search warrant at his residence, at which time they seized computer media and cellular phones. Forensic analysis of the phone, computer media and virtual storage accounts revealed 300 child pornography images and 2000 child pornography videos.
At a detention hearing held shortly after his arrest in April 2017, Furzland was found to be a flight risk and danger to the community. He has been in custody since that time where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The FBI conducted the investigation.
Assistant U.S. Attorney Sherri Zack is prosecuting the case which was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Rotech Agrees to Pay $9.68 Million to Settle False Claims Act Liability Related to Improper Billing for Portable OxygenRead the Press Release
WASHINGTON – The Justice Department announced today that Rotech Healthcare Inc., a Florida-based respiratory equipment supplier, has agreed to pay $9.68 million for knowingly submitting false claims for portable oxygen contents to Medicare. As part of the settlement, Rotech admitted that it knowingly billed portable oxygen contents to Medicare for beneficiaries who did not use or require them. The Company further admitted to billing Medicare regardless of whether such contents were delivered.
“This settlement serves as a warning to suppliers who bill first and ask questions later,” said Acting Assistant Attorney General Chad A. Readler, head of the Justice Department’s Civil Division. “We will investigate and take action against companies who cut corners and place profits over compliance with Medicare’s billing requirements.”
Medicare covers rentals of portable and stationary oxygen equipment for up to 36 months and allows suppliers to bill monthly for oxygen to be used with that equipment for up to 24 additional months after the rental period. Between January 2009 and March 2012, Rotech automatically billed Medicare for portable oxygen contents for all Medicare beneficiaries after the 36-month rental period, without verifying that the beneficiaries used or needed portable oxygen, and without obtaining the requisite proof of delivery. Rotech continued this practice despite knowing that it resulted in the submission of claims for portable oxygen contents that were ineligible for reimbursement.
“Many people believe that healthcare fraud is a victimless crime; I assure you it is not,” said United States Attorney Joseph D. Brown of the Eastern District of Texas. “Medicare is funded largely by you and me, the American taxpayers, and fraud contributes to runaway health care costs. I commend the whistleblower who had the courage to come forward and who worked with investigators to get to the bottom of this case. Because of her, we were able to recoup millions of dollars improperly paid to Rotech.”
The allegations resolved by this settlement arose from a whistleblower lawsuit filed under the False Claims Act by Janet Hale, a former employee in Rotech’s billing department. Under the False Claims Act, private citizens can sue on behalf of the government and share in any recovery. Ms. Hale will receive $1,645,600.
The settlement was the result of a coordinated effort by the Civil Division’s Commercial Litigation Branch, the United States Attorney’s Office for the Eastern District of Texas, the Federal Bureau of Investigation, the Department of Health and Human Services Office of Inspector General, and the Texas Office of the Attorney General – Medicaid Fraud Control Unit.
The case is captioned United States ex rel. Hale v. Rotech Healthcare Inc., 4:14-cv-545 (E.D. Tex.).
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Principal Deputy Assistant Attorney General Andrew Finch Delivers Introductory Remarks at the 2018 Antitrust Writing Award CeremonyRead the Press Release
Thank you for inviting me here this evening. I am delighted to be part of the celebration of the talented nominees and winning authors that have contributed to our understanding of antitrust law. It’s also wonderful to look out and see so many friends and familiar faces. This is a great way to kick off the week of the Spring meeting.
I am going to start with an apology of sorts: I’m not going to announce any new Antitrust Division policies or enforcement actions. And I’m not going to dive into the hot antitrust topics of the day, such as “so-called” big data or standards-essential patents. I hope that’s not a disappointment, but I think you’ll hear more than enough of that over the next several days. Instead, I would like to say a few words about good writing and its role in antitrust law.
Many have observed that words are the raw material and tools of the legal profession. Indeed, all that we do as lawyers is work with words: The words of ordinary people—the things they say and emails they write—that can become evidence; the words in contracts and disclosures; the words of witnesses in depositions and at trial; the words in lawyers’ memos, briefs and oral arguments; the words in law review articles by learned academics; the words of the judges in their decisions and orders (including some of the best words, such as “affirmed” or “reversed,” depending on your case or client); and, not least, the words enacted by Congress.
From the perspective of the legal advocate, words are only the beginning. The words must be strung together in sentences and paragraphs in order to persuade. That brings us to the importance of good writing, which is what we are here to celebrate this evening.
Lawyers worth their salt must be able to write clearly and effectively, but I’d suggest that strong writing is especially important in the domain of antitrust law. I think there are two reasons for that.
First, antitrust law is a common-law field. That presents opportunities for persuasive lawyers and judges to make their case for the proper interpretation or application of a short statutory phrase like “restraint of trade” or “substantially to lessen competition” in light of experience and logic.
Second, modern antitrust law relies heavily on economics. The ability to explain complex and technical economics concepts with clarity and precision has become one of the most important skills in our corner of the legal profession. In that regard I should note that, as the legal profession becomes more and more specialized, effective legal advocacy requires writers to resist an over-reliance on jargon. Indeed, antitrust lawyers can be among the worst offenders in this regard. Too often, we fall back on shorthand terms or phrases to convey meaning: Section 1, Section 2, Section 7, Section 8, HHIs, SSNIP tests, horizontal and vertical, rule of reason and per se, quick look, elimination of double marginalization . . . the list goes on.
It is unsurprising that clear and lively writing has been especially influential in antitrust jurisprudence. Antitrust opinions that have been cited time and again are those that instruct and persuade by enlivening abstract or technical concepts with clever prose. Great antitrust opinions often convey complex ideas in memorable ways.
Judge Boudin, who happens to be a former Antitrust Division Deputy, wrote an article explaining how metaphors can be very effective in antitrust writing. He wrote that “[m]etaphors meet the same felt need for graspable ideas in a different way by making the abstractions of antitrust more concrete and often more dramatic.”
One memorable example is from Socony-Vacuum Oil, where Justice Douglas described competitive pricing as the “central nervous system of the economy.” Or who can forget a phrase like “the Magna Carta of free enterprise”? These insightful metaphors capture the essence of antitrust law, and they have left a lasting impression on antitrust jurisprudence.
The sparse text and common-law nature of Section 1 of the Sherman Act provide an especially good opening for the influence of judges that are gifted writers to leave their mark on the development of the law. In the seminal Chicago Board of Trade decision 100 years ago, Justice Brandeis described the rule of reason—which the Court had introduced just under seven years before—as follows: “The true test of legality is whether the restraint imposed is such as merely regulates and perhaps thereby promotes competition or whether it is such as may suppress or even destroy competition.” That elegant formulation is the essence of the test we still apply to the vast majority of challenged conduct, weighing procompetitive benefits against anticompetitive effects.
Insightful writing has continued to refine Section 1’s categories over the years. For example, we learned from Justice White in the BMI decision that “easy labels do not always supply ready answers.” That was his succinct way of telling us that antitrust analysis must be sufficiently nuanced to take into account the characteristics of the conduct that is under scrutiny.
The BMI decision also announced what may be the most often-quoted test for application of the per se rule, asking whether the practice at issue “facially appears to be one that would always or almost always tend to restrict competition and decrease output . . . or instead one designed to ‘increase economic efficiency and render markets more, rather than less, competitive.’”
Another one of my personal favorites comes from the Supreme Court’s 1984 Copperweld decision, which used imaginative language to explain why a parent company and its wholly owned subsidiary no longer could be held liable for a conspiracy under Section 1. Chief Justice Burger wrote: “A parent and its wholly owned subsidiary have a complete unity of interest. Their objectives are common, not disparate; their general corporate actions are guided or determined not by two separate corporate consciousnesses, but one. They are not unlike a multiple team of horses drawing a vehicle under the control of a single driver.” (I confess that I’m afraid that clever imagery may not withstand the test of time in the coming age of driverless cars.)
As for Section 2, enduring prose that immediately comes to mind is in Judge Learned Hand’s Alcoa opinion, written in 1945. Although Judge Hand found that Alcoa illegally monopolized the aluminum market, he distinguished illegal monopolization from lawful monopoly with striking clarity when he wrote that “[a] single producer may be the survivor out of a group of active competitors, merely by virtue of his superior skill, foresight and industry. . . . The successful competitor, having been urged to compete, must not be turned upon when he wins.”
That’s an important lesson that—once learned—you can never quite forget. It continues to teach us not to punish a firm due to its size or natural commercial success, and that phrase is still quoted in antitrust writing today. Indeed, the Supreme Court adopted suspiciously similar language years later in Grinnell when it distinguished “the willful acquisition or maintenance of [monopoly] power” from “growth or development as a consequence of a superior product, business acumen, or historic accident.”
While we are on the subject of memorable antitrust jurisprudence, I should take a moment to acknowledge one of the best legal writers in American jurisprudence more generally, the late Justice Scalia. Justice Scalia contributed significantly to U.S. antitrust jurisprudence and, perhaps more importantly, to the art of persuasive writing itself.
Former Solicitor General (and Scalia Clerk) Paul Clement said recently that “[t]he best lines in a Scalia opinion were no mere rhetorical flourishes. They were images — usually far removed from the technical legal questions at hand — that perfectly captured the point the Justice was trying to make.”
Scalia’s last major antitrust opinion, Trinko, is often quoted for, among other things, his explanation of why forcing monopolists to share their goods or services with competitors is a bad idea. “Enforced sharing,” he wrote, “requires antitrust courts to act as central planners, identifying the proper price, quantity, and other terms of dealing—a role for which they are ill suited. Moreover, compelling negotiation between competitors may facilitate the supreme evil of antitrust: collusion.”
I should also note that in Trinko Justice Scalia also described the Aspen Skiing decision—the “leading case” for imposing liability for refusing to deal under Section 2—as “at or near the outer boundary of § 2 liability.” I think there’s a clever skiing metaphor buried in there somewhere.
In conclusion, I note that our nation appears to be in the midst of what some have called an “antitrust moment.” Antitrust law makes national and global headlines on a weekly—if not daily—basis. Last Friday morning, I saw a puzzled anchor on CNBC ask a guest whether “monopsony” is a real word.
In this environment, good antitrust writing takes on an increased significance. The wide range of topics covered in the works being honored this evening will contribute to this important conversation.
Pittsburgh Man Pleads Guilty to Southside Armed Bank Robbery SpreeRead the Press Release
PITTSBUGRH, PA. - A former resident of Pittsburgh, Pennsylvania, pleaded guilty in federal court to charges of violating federal robbery laws, United States Attorney Scott W. Brady announced today.
Thomas Hetrick, age 50, pleaded guilty to five counts before United States District Judge Schwab.
In connection with the guilty plea, the court was advised that Hetrick, while armed with either a knife or a gun, robbed the Dollar Bank, located at 1712 East Carson Street, Pittsburgh, PA, on August 21, 2017; the First Commonwealth Bank, located at 2501 East Carson Street, Pittsburgh, PA, on August 24, 2017 and again on August 30, 2017; and the First Commonwealth Bank, located at 500 East Waterfront Drive, Pittsburgh, PA 15210, on September 25, 2017. Hetrick also attempted to rob, while armed with a knife, the same First Commonwealth Bank, located at 2501 East Carson Street, Pittsburgh, PA, on September 25, 2017.
Judge Schwab scheduled sentencing for September 26, 2018. The law provides for a total maximum sentence of not more than 25 years in prison, a fine of not more than $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Pending sentencing, the court ordered Hetrick remain in custody.
Assistant United States Attorney Timothy M. Lanni is prosecuting this case on behalf of the government.
The FBI Pittsburgh’s Violent Crimes Task Force, with assistance from the Homestead Police Department, the Allegheny County Sheriff’s Department, and the Pittsburgh Bureau of Police conducted the investigation that led to the prosecution of Thomas Hetrick.
Pierre Woman Indicted for Assault ChargesRead the Press Release
United States Attorney Ron Parsons announced that a Pierre, South Dakota, woman has been indicted by a federal grand jury for two counts of Assaulting, Resisting, and Impeding a Federal Officer.
Toni Ladeaux, age 21, was indicted on March 13, 2018. She appeared before U.S. Magistrate Judge Mark A. Moreno on April 12, 2018, and pled not guilty to the Indictment.
The maximum penalty for each count upon conviction is up to 8 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on February 8, 2018, Ladeaux, forcibly kicked multiple Rosebud Sioux Tribe law enforcement officers.
The charges are merely accusations and Ladeaux is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Kirk Albertson is prosecuting the case.
Ladeaux was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Owner of Michigan Marketing Company Charged with Tax CrimesRead the Press Release
A federal grand jury sitting in Flint, Michigan, has returned an indictment, which was unsealed yesterday, charging a Michigan business owner with filing a false tax return and failing to file tax returns, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.
According to the indictment, Sarah Vidican, owned and operated a marketing and consulting company in Michigan and Florida under the name Magnalty LLC (Magnalty). Magnalty allegedly provided marketing and consulting services to physicians and chiropractors.
The indictment charges that Vidican filed a false 2012 partnership tax return for Magnalty that underreported the business’s income. The indictment further alleges that Vidican failed to file a personal tax return for 2013 and failed to file a 2014 partnership tax return for Magnalty, despite having an obligation to do so.
If convicted, Vidican faces a statutory maximum sentence of three years in prison for filing a false tax return and one year in prison for each failure to file count. Vidican also faces a period of supervised release, restitution and monetary penalties. An indictment merely alleges that crimes have been committed. A defendant is presumed innocent until proven guilty beyond a reasonable doubt.
Acting Deputy Assistant Attorney General Goldberg commended special agents of IRS Criminal Investigation, who conducted the investigation, and Tax Division Trial Attorneys Mark McDonald and William Guappone, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Owner of Kansas Medical Staffing Company Indicted in Employment Tax SchemeRead the Press Release
A federal grand jury sitting in Kansas City, Kansas, returned an indictment, which was unsealed yesterday, charging a Jefferson County, Kansas, man with seven counts of willful failure to pay over employment taxes to the Internal Revenue Service (IRS), announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Stephen McAllister for the District of Kansas.
According to the indictment, David Monhollon failed to pay over federal income, Social Security, and Medicare taxes withheld from the wages paid to employees of his medical staffing company, First Call Medical Group. The indictment alleges that Monhollon was the owner of First Call and was obligated to pay over to the IRS such payroll taxes on behalf of his company. Instead of remitting the money to the IRS, Monhollon allegedly used the funds to pay for personal expenses including racecar parts and equipment.
If convicted, the defendant faces a statutory maximum sentence of five years in prison for each count. He also faces a period of supervised release, restitution, and monetary penalties. An indictment merely alleges that crimes have been committed. A defendant is presumed innocent until proven guilty.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney McAllister commended special agents of IRS Criminal Investigation, who investigated the case, and Assistant U.S. Attorney Leon Patton and Tax Division Trial Attorney John Mulcahy, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Owner of Kansas Medical Staffing Company Indicted in Employment Tax SchemeRead the Press Release
KANSAS CITY, KAN. – A federal grand jury sitting in Kansas City, Kan., returned an indictment Wednesday charging a Jefferson County, Kan., man with seven counts of willful failure to pay over employment taxes to the Internal Revenue Service (IRS).
U.S. Attorney Stephen McAllister and Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division announced the indictment today.
According to the indictment, David Monhollon failed to pay over federal income, Social Security and Medicare taxes withheld from the wages paid to employees of his medical staffing company, First Call Medical Group. The indictment alleges that Monhollon was the owner of First Call and was obligated to pay over to the IRS such payroll taxes on behalf of his company. Instead of remitting the money to the IRS, Monhollon allegedly used the funds to pay for personal expenses including racecar parts and equipment.
If convicted, the defendant faces a statutory maximum sentence of five years in prison for each count. He also faces a period of supervised release, restitution and monetary penalties. An indictment merely alleges that crimes have been committed. A defendant is presumed innocent until proven guilty.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney McAllister commended special agents of IRS Criminal Investigation, who investigated the case, and Assistant U.S. Attorney Leon Patton and Tax Division Trial Attorney John Mulcahy, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Ocean Springs Man Sentenced to Two Years in Prison for Wire Fraud SchemeRead the Press Release
Gulfport, Miss. – Thomas Richard Lepre, 63, of Ocean Springs, Mississippi, was sentenced today by U.S. District Judge Sul Ozerden to two years in federal prison followed by three years of supervised release for a wire fraud scheme, announced U.S. Attorney Mike Hurst and FBI Special Agent in Charge Christopher Freeze. Lepre was also ordered to pay $504,369.00 in restitution to victims.
Lepre devised a fraudulent wire scheme as an owner in a commercial financing partnership known as Alternative Financing Group ("AFG"). AFG purported to broker loans for individuals unable to obtain financing through traditional methods. Sources of income for the loans came from private investors to whom Lepre represented their moneys would be used to fund loans for AFG borrowing clients. The investigation revealed that, in fact, Lepre converted a large portion of the wired funds to his own use.
This case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Andrea Jones.
Northfield man charged with stealing $684,000 after still working while collecting disability benefits for back injuryRead the Press Release
A Northfield man was charged today with stealing more than $684,000 after still working while collecting disability benefits, said U.S. Attorney Justin E. Herdman.
Thomas H. Cannell, 62, was charged via criminal information with one count of theft of government funds and one count of wire fraud.
Cannell fraudulently collected benefits from Social Security and Ohio Bureau of Workers’ Compensation for beginning in 1980, when he developed lower back pain at work. Cannell had been entitled to disability payments from a work-related injury in 1982. However, Cannell was required to report to both agencies whether he returned to work, which would terminate his ability to receive continued payments from both agencies, according to a criminal information.
Cannell developed a scheme where he could conceal his income as a fireplace salesman by not being paid directly from his employers. This scheme continued for decades until investigators uncovered Cannell working in 2016, according to court documents.
Special Agents James Altman from the Social Security Administration Office of the Inspector General and Alec Gilchrist from the Ohio Bureau of Workers' Compensation, Special Investigations Department, conducted the investigation. Special Assistant U.S. Attorney Payum Doroodian is prosecuting the case.
If convicted, the Court will determine the defendant’s sentence after a review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum. In most cases, it will be less than the maximum.
An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.