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Wednesday 24 January 2018
Pennsylvania Biofuel Company Owners Indicted for Seeking Tax Refunds Based on Fraudulently Claimed Fuel Tax CreditsRead the Press Release
HARRISBURG – United States Attorney David J. Freed for the Middle District of Pennsylvania, Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division, and Acting Assistant Attorney General Jeffrey H. Wood of the Justice Department’s Environment and Natural Resources Division announce that two owners of a Pennsylvania biofuel company were charged in a superseding indictment today with conspiring to defraud the Internal Revenue Service (IRS) and aiding and assisting in the preparation of a fraudulent fuel tax credit refund claim.
According to the superseding indictment, Ben Wootton, age 52, of Pennsylvania, and Race Miner, age 48, of Colorado owned and operated Keystone Biofuels Inc., located in Shiremanstown, Pennsylvania, and later in Camp Hill, Pennsylvania. Wootton, serving as President, and Miner, serving as Chief Executive Officer, are alleged to have participated in a conspiracy to defraud the IRS by, among other things, fraudulently claiming tax refunds based on the Biodiesel Mixture Credit – a federal excise tax credit for persons or businesses who mix biodiesel with diesel fuel and use or sell the mixture as a fuel. Biodiesel is a type of renewable fuel that meets a set of specific requirements.
According to the superseding indictment, the Biodiesel Mixture Credit was available only on fuel meeting those requirements that the claimant had mixed with diesel fuel. Wootton and Miner allegedly caused Keystone to fraudulently seek tax refunds from the IRS by claiming the credit based on non-qualifying and, in at least some instances, non-existent or non-mixed fuel. The indictment further alleges that Wootton and Miner created false books and records and supporting documents to account for the nonexistent fuel; engaged in a series of sham financial transactions to give the false books and records the appearance of legitimacy; and sought to obstruct an ongoing IRS investigation by providing false documentation to an IRS Special Agent.
These charges are in addition to those previously lodged against Wootton and Miner. In a May 2017 indictment, both men, along with Keystone Biofuels Inc., were charged with conspiring to make false statements to the Environmental Protection Agency (EPA) and making false statements to the EPA.
If convicted, Wootton and Miner face a statutory maximum sentence of five years in prison for conspiracy and three years in prison for aiding and assisting in the filing a false refund claim. They also face a period of supervised release, restitution, and monetary penalties.
An indictment merely alleges that crimes have been committed. The defendants are presumed innocent until proven guilty beyond a reasonable doubt.
U.S. Attorney Freed, Principal Deputy Assistant Attorney General Zuckerman, and Acting Assistant Attorney General Wood, praised special agents of IRS Criminal Investigation and the Environmental Protection Agency Criminal Investigation Division, who conducted the investigation, and Assistant U.S. Attorney Geoffrey MacArthur, Special Assistant U.S. Attorney David Lastra, Trial Attorneys Mark Kotila and Kimberly Ang of the Justice Department’s Tax Division and Senior Litigation Counsel Howard Stewart of the Justice Department’s Environmental and Natural Resources Division, Environmental Crimes Section, who are prosecuting the case.
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Pennsylvania Biofuel Company Owners Charged with Fraudulently Claiming Fuel Tax CreditsRead the Press Release
Two owners of a Pennsylvania biofuel company were charged in a superseding indictment today with conspiring to defraud the Internal Revenue Service (IRS) and aiding and assisting in the preparation of a fraudulent fuel tax credit refund claim, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division, Acting Assistant Attorney General Jeffrey H. Wood of the Justice Department’s Environment and Natural Resources Division and U.S. Attorney David J. Freed for the Middle District of Pennsylvania.
According to the superseding indictment, Ben Wootton, of Pennsylvania, and Race Miner, of Colorado owned and operated Keystone Biofuels Inc., located in Shiremanstown, Pennsylvania, and later in Camp Hill, Pennsylvania. Wootton, serving as President, and Miner, serving as Chief Executive Officer, are alleged to have participated in a conspiracy to defraud the IRS by, among other things, fraudulently claiming tax refunds based on the Biodiesel Mixture Credit – a federal excise tax credit for persons or businesses who mix biodiesel with diesel fuel and use or sell the mixture as a fuel. Biodiesel is a type of renewable fuel that meets a set of specific requirements.
According to the superseding indictment, the Biodiesel Mixture Credit was available only on fuel meeting those requirements that the claimant had mixed with diesel fuel. Wootton and Miner allegedly caused Keystone to fraudulently seek tax refunds from the IRS by claiming the credit based on non-qualifying and, in at least some instances, non-existent or non-mixed fuel. The indictment further alleges that Wootton and Miner created false books and records and supporting documents to account for the nonexistent fuel; engaged in a series of sham financial transactions to give the false books and records the appearance of legitimacy; and sought to obstruct an ongoing IRS investigation by providing false documentation to an IRS Special Agent.
These charges are in addition to those previously lodged against Wootton and Miner. In a May 2017 indictment, both men, along with Keystone Biofuels Inc., were charged with conspiring to make false statements to the Environmental Protection Agency (EPA) and making false statements to the EPA.
If convicted, Wootton and Miner face a statutory maximum sentence of five years in prison for conspiracy and three years in prison for aiding and assisting in the filing of a false refund claim. They also face a period of supervised release, restitution, and monetary penalties.
An indictment merely alleges that crimes have been committed. The defendants are presumed innocent until proven guilty beyond a reasonable doubt.
Principal Deputy Assistant Attorney General Zuckerman, Acting Assistant Attorney General Wood, and U.S. Attorney Freed praised special agents of IRS Criminal Investigation and the Environmental Protection Agency Criminal Investigation Division, who conducted the investigation, and Assistant U.S. Attorney Geoffrey MacArthur, Special Assistant U.S. Attorney David Lastra, Trial Attorneys Mark Kotila and Kimberly Ang of the Justice Department’s Tax Division and Senior Litigation Counsel Howard P. Stewart of the Justice Department’s Environmental and Natural Resources Division, Environmental Crimes Section, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Paris Man Pleads Guilty to Conspiracy to Distribute Crack CocaineRead the Press Release
LEXINGTON, Ky. — Cole Lee Rankin, 24, of Paris, pleaded guilty today to Conspiracy to Distribute Cocaine Base.
In his guilty plea, Rankin admitted that he had, on several occasions, distributed cocaine base, in Harrison County and Bourbon County, Kentucky, between March 2015 and September 2016.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart Lowery, Special Agent in Charge, ATF; Richard Sanders, Commissioner Kentucky State Police; Burl Purdue, Clark County Sheriff; and Shain Stephens Harrison County Sheriff, jointly announced the guilty plea.
The ATF, Kentucky State Police, Clark County Sheriff’s Department, and Harrison County Sheriff’s Department conducted the investigation. Assistant United States Attorney Lauren Tanner Bradley represented the United States in the case. The case is part of the Project Safe Neighborhoods (PSN) Program, a Department of Justice initiative to reduce violent crime through partnerships between federal, state, and local law enforcement. The goal of the PSN Program is to use these partnerships to make communities safer.
Rankin will appear for sentencing before Chief United States District Judge Karen K. Caldwell in Lexington, on April 20, 2018, at 1:30 p.m.
Rankin faces a mandatory minimum sentence of five years and a maximum prison sentence of 40 years. The Court, however, will impose any sentence after consideration of the U.S. Sentencing Guidelines and the applicable federal statutes.
Pair found guilty of racketeer influenced corrupt organization conspiracy in federal courtRead the Press Release
Ten members of Elite Enterprise convicted, two at trial with eight pleading guilty to participating in a RICO conspiracy or related fraud counts for defrauding financial institutions and insurance companies across the country.
PRESS RELEASE
Indianapolis – United States Attorney Josh J. Minkler announced today the convictions of the final two defendants after a two-week jury trial, in a corrupt business organization plot to deceive a myriad of financial institutions and insurance companies across the country resulting in a loss upwards of $1.6 million. Mahdi Khelifi, 25, and Hamza Dridi 28, both of Indianapolis, were found guilty of conspiracy to commit racketeer influenced and corrupt organization and interstate transportation of stolen property. Khelifi was also charged with conspiracy to commit mail fraud and two counts of conspiracy to commit wire fraud.
“We are pleased that the jury was able to see this scheme for what is was,” said Minkler. “Elite Enterprise profited because of a continuous and pervasive culture of corruption. With the conviction of the final members of this criminal group, we have sent a strong message: if your business model includes stealing from others, we stand ready to enforce federal law to close your doors and to move criminals from their offices to the Bureau of Prisons.”
Khelifi and Dridi worked and managed Elite Imports, LLC and Elite Car Imports, LLC, which were car dealerships operating in two primary locations, 4550 N. Keystone Avenue and 8102 Pendleton Pike. As part of the conspiracy, Elite would work with customers to help them secure loans in order to purchase Elite’s vehicles. If the customer qualified, the lenders provided money for vehicle purchases by customers who could not pay for the vehicle in cash. Khelifi and Dridi and other members of the Elite Enterprise deceived these lenders by submitting fraudulent documents and information, such as proof of income (paystubs, driver’s licenses, social security numbers, and dates of birth) and proof of residency (utility bills), among other things. Enterprise members created or obtained these fraudulent documents so that they could deceive the lenders. Many of the fraudulent documents showed that Elite customers worked at shell companies. The goal of the Elite Enterprise was make the prospective lender believe that the customer was credit-worthy, with appropriate income levels, employment status and valid state drivers’ licenses to obtain loans.
The second racketeering fraud scheme involved members of the conspiracy making false claims to insurance companies, reporting vehicles as stolen, when in fact they were not. The defendants and associates were then reimbursed by various insurance companies for the purported stolen vehicles. 11 vehicles and vehicle parts previously reported stolen to insurance companies and the police were located in a chop shop behind the Keystone location when federal agents raided the business in September 2015.
The third fraud scheme involved floor plan financing and money laundering.
The case was investigated through a collaborative partnership between the Federal Bureau of Investigation, the U.S. Postal Inspection Service, the U.S. Social Security, OIG, the Lawrence Police Department and the Indianapolis Metropolitan Police Department, with assistance provided by the Indiana Secretary of State, Auto Division, and the Indiana Attorney General Consumer Fraud Division.
"This type of fraud has a devastating impact on victims and the verdict sends a clear message that illegal business practices in the form of white collar crime won't be tolerated," said W. Jay Abbott, Special Agent in Charge of the FBI's Indianapolis Division. "The FBI and our law enforcement and regulatory partners will continue to aggressively pursue those who perpetrate these schemes and steal from hardworking Americans."
“The wheels of justice moved swiftly, as indicated by the jury’s quick verdict. The conviction of both defendants ensures two fraudsters will now be imprisoned for the crimes they committed against the American public,” said Detroit Division Inspector in Charge, Patricia Armstrong, U.S. Postal Inspection Service.
Assistant United States Attorneys Cynthia J. Ridgeway and Kristina M. Korobov are prosecuting the case for the government and said Khelifi and Dridi could face up to 20 years’ imprisonment.
U. S. District Judge William T. Lawrence presided over the trial. No sentencing date has been set.
In October 2017, United States Attorney Josh J. Minkler announced a Strategic Plan designed to shape and strengthen the District’s response to its most significant public safety challenges. This prosecution demonstrates the office’s firm commitment to utilize and partner with law enforcement agencies to prosecute individuals engaged in large-scale fraud schemes. See United States Attorney’s Office, Southern District of Indiana Strategic Plan Section 5.1.
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Owner of Nevada Home Health Care Firm Sentenced to Prison for Employment Tax FraudRead the Press Release
A Las Vegas, Nevada, business owner was sentenced today to 12 months and one day in prison for evading payment of employment taxes and penalties, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Dayle Elieson of the District of Nevada.
Maria Larkin, 55, was convicted of tax evasion by a federal jury in Las Vegas in June. According to the evidence presented at trial, Larkin owned and operated Five Star Home Health Care Inc. (Five Star). Larkin was responsible for collecting and paying over income, social security, and Medicare tax withheld from her employees’ wages. From 2004 through 2009, Larkin did not pay over to the Internal Revenue Service the employment taxes she withheld. As a result, the IRS assessed trust fund recovery penalties (TFRPs) against Larkin for these years, which made her personally liable for the unpaid employment taxes.
Larkin concealed her assets and income to evade paying the TFRPs and to obstruct the IRS’s efforts to collect the outstanding taxes. She lied to the IRS regarding her ability to pay, changed the name of her business, placed her business in the name of a nominee, had her employees cash checks for her, and bought a home in the name of a nominee. In total, Larkin evaded more than $1.6 million in taxes.
In addition to the term of prison imposed, U.S. District Court Judge James C. Mahan ordered Larkin to serve three years of supervised release and to pay $1,153,633.50 in restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Elieson commended special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorney John T. Mulcahy of the Tax Division and Assistant U.S. Attorney Alexandra M. Michael, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Owner of Nevada Home Health Care Firm Sentenced to Prison for Employment Tax FraudRead the Press Release
LAS VEGAS, Nev. – A Las Vegas, Nevada, business owner was sentenced today to 12 months and one day in prison for evading payment of employment taxes and penalties, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Dayle Elieson of the District of Nevada.
Maria Larkin, 55, was convicted of tax evasion by a federal jury in Las Vegas in June. According to the evidence presented at trial, Larkin owned and operated Five Star Home Health Care Inc. (Five Star). Larkin was responsible for collecting and paying over income, social security, and Medicare tax withheld from her employees’ wages. From 2004 through 2009, Larkin failed to pay over to the Internal Revenue Service (IRS) the employment taxes she withheld. As a result, the IRS assessed trust fund recovery penalties (TFRPs) against Larkin for these years, which made her personally liable for the unpaid employment taxes.
Larkin concealed her assets and income to evade paying the TFRPs and to obstruct the IRS’s efforts to collect the outstanding taxes. She lied to the IRS regarding her ability to pay, changed the name of her business, placed her business in the name of someone else, had her employees cash checks for her, and bought a home in the name of someone else. In total, Larkin evaded more than $1.6 million in taxes.
In addition to the term of prison imposed, U.S. District Court Judge James C. Mahan ordered Larkin to serve three years of supervised release and to pay $1,153,633.50 in restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Elieson commended special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorney John T. Mulcahy of the Tax Division and Assistant U.S. Attorney Alexandra M. Michael, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
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Oregon U.S. Attorney's Office Collects Nearly $24 Million in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2017Read the Press Release
PORTLAND – U.S. Attorney Billy J. Williams announced today that the District of Oregon collected $21,705,595 in criminal and civil actions in Fiscal Year 2017. Of this amount, $8,066,251 was collected in criminal actions and $13,639,344 in civil actions.
Additionally, the District of Oregon worked with other U.S. Attorney’s Offices, Justice Department components and partner agencies to collect $575,775 in joint criminal and civil actions and $1,540,289 in asset forfeitures, bringing Oregon’s total to nearly $24 million. Forfeited assets deposited into the Justice Department’s Assets Forfeiture Fund are used to assist crime victims and for a variety of other law enforcement purposes.
Overall, the Justice Department collected more than $15 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2017.
“Thanks to the hard work and dedication of the District of Oregon’s Asset Recovery and Money Laundering Division and our partner agencies, funds recovered in the past fiscal year far exceed our office’s annual operating budget,” said Billy J. Williams, United States Attorney for the District of Oregon. “Our staff is dedicated to holding accountable those who seek to profit from illegal activities and will continue aggressively pursuing financial compensation for victims of crimes, and protecting government programs from exploitation and abuse.”
One example of the district’s recent restitution collection efforts was in a series of cases brought against members of the Desmarais family who owned and operated eight strip clubs and two adult video stores in the Portland metropolitan area. The family used these businesses as a front for the largest prostitution enterprise ever prosecuted in Oregon. The family collected cash every time a stripper engaged in an act of prostitution with a customer from 2006 through 2010, evading $728,165 in income taxes due on $2.6 million in unreported prostitution income. The four most culpable family members pleaded guilty to conspiring to defraud the Internal Revenue Service (IRS) and running a prostitution business. They were ordered to pay the IRS $728,165 in restitution and agreed to forfeit an additional $843,517 in cash seized during the execution of search warrants.
Another example comes from a case stemming from a July 28, 2009 fire in the Umpqua National Forest in southern Oregon known as the Williams Creek Fire. The Williams Creek Fire burned approximately 8,395 acres, most of which were National Forest System lands within the Umpqua National Forest. The fire caused the U.S. Department of Agriculture (USDA) to incur suppression, resource damages, and rehabilitation costs totaling over $16 million. An investigation concluded that the fire was caused by a power line fault occurring on a utility right of way owned, managed and controlled by PacifiCorp. The U.S. Attorney’s Office filed an action on behalf of the USDA seeking to recover the costs incurred by the U.S. related to the fire and ultimately collected $13 million.
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
Nurse Practitioner Pleads Guilty to Drug Distribution and Health Care Fraud Charges in Ongoing “Pill Mill” CaseRead the Press Release
Montgomery, Ala. – On Monday, January 22, 2017, Steven Edwin Cox, 61, of Tallassee, Alabama, pleaded guilty to drug distribution conspiracy and health care fraud charges arising out of the ongoing investigation and prosecution of a Montgomery “pill mill,” announced United States Attorney Louis V. Franklin, Sr. The “pill mill” at issue was the Family Practice medical office located at 4143 Atlanta Highway in Montgomery, Alabama.
According to court documents, until 2017, Cox worked at the Family Practice with Dr. Gilberto Sanchez. In November of 2017, Sanchez pled guilty to drug distribution, health care fraud, and money laundering charges arising out of the same scheme. Cox’s role in the scheme was to see patients originally prescribed unnecessary controlled substances by Sanchez and to give those patients refills on their prescriptions. Cox did so knowing that the patients did not actually need the medicine he was prescribing to them. Cox also helped Sanchez to fraudulently bill health insurance companies for the time he spent seeing the patients.
At sentencing, Cox faces a maximum sentence of 20 years’ imprisonment on the drug distribution conspiracy charge, and 10 years’ imprisonment on the health care fraud charge. He also faces substantial monetary penalties and restitution.
This case was investigated by the Drug Enforcement Administration’s Tactical Diversion Squad, the Internal Revenue Service’s Criminal Investigation Division, and the Department of Health and Human Services – Office of Inspector General. The Montgomery County, Alabama Sheriff’s Office, the Alabama Board of Medical Examiners, the Montgomery, Alabama Police Department, and the Opelika, Alabama Police Department all assisted in the investigation. Assistant United States Attorneys Jonathan S. Ross and R. Rand Neeley are prosecuting the case.
New Orleans Man Pleads Guilty to Bank RobberyRead the Press Release
U.S. Attorney Duane A. Evans announced that LESTER MALAVA, age 57, of New Orleans, pleaded guilty today before the Honorable Kurt D. Engelhardt, Chief Judge of the United States District Court for the Eastern District of Louisiana, to a one-count Bill of Information charging him with bank robbery.
According to court papers, MALAVA robbed the Capital One Bank at 3540 St. Charles Avenue in New Orleans on August 21, 2017. MALAVA was identified on an FBI tip line and later turned himself in to authorities. He faces a sentence of up to ten years in prison and a fine of $250,000, and a mandatory special assessment of $100.00. Sentencing is set before Chief Judge Engelhardt on April 25, 2018.
U.S. Attorney Evans praised the work of the Federal Bureau of Investigation in investigating this matter. Assistant U.S. Attorney David Haller is in charge of the prosecution.
New Haven Man Pleads Guilty to Heroin Distribution Charge Stemming from Shelton Overdose DeathRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that COREY SENIOR, 26, of New Haven, pleaded guilty today before U.S. District Judge Victor A. Bolden in Bridgeport to one count of possession with intent to distribute, and distribution of, heroin.
This matter stems from an ongoing statewide initiative targeting narcotics dealers who distribute heroin, fentanyl or opioids that cause death or serious injury to users.
According to court documents and statements made in court, on April 27, 2017, the Shelton Police Department and emergency medical services responded to a Shelton residence after a report of a suspected drug overdose of a 34-year-old female. The victim was pronounced deceased at the scene. Officers seized drug and non-drug evidence, including bags that appeared to have contained heroin, and a hypodermic needle. Investigators also seized the victim’s cellphone.
On April 28, 2017, the victim’s cellphone received a text from SENIOR and an officer, posing as the victim, arranged to purchase heroin from SENIOR. Shelton Police arrested SENIOR later that day after he arrived at the victim’s residence in possession of suspected heroin.
The investigation revealed that SENIOR had provided heroin to the victim shortly before the victim’s death.
SENIOR was arrested on a federal criminal complaint on May 16, 2017.
SENIOR faces a maximum term of imprisonment of 20 years. A sentencing date is not scheduled.
This matter has been investigated by the Drug Enforcement Administration’s New Haven Task Force and the Shelton Police Department. This case is being prosecuted by Assistant U.S. Attorney John T. Pierpont, Jr.
Multistate Serial Bank Robber Pleads Guilty to Robberies in California, Nevada, and UtahRead the Press Release
SACRAMENTO, Calif. — Gregory Jerome Brown, 28, of Bountiful, Utah, pleaded guilty today to robbing three banks, U.S. Attorney McGregor W. Scott announced.
According to court documents, Brown robbed three banks in three different states. Brown wrote his demands on an index card, and in one note, he claimed to have a gun. After the robberies, Brown rode away on his motorcycle. After the Utah bank robbery, Brown fled south and was apprehended in Phoenix, Arizona.
This morning Brown admitted that he robbed the following banks:
- On October 13, 2017, he robbed the Wells Fargo Bank at 338 Elm Avenue, Auburn, California;
- On October 14, 2017, he robbed the Wells Fargo Bank at 2895 Northtowne Lane, Reno, Nevada;
- On November 8, 2017, he robbed the America First Credit Union at 2928 East Mall Drive, Saint George, Utah.
This case is the product of an investigation by the Federal Bureau of Investigation with assistance from the Auburn Police Department, the Reno Police Department, the Saint George Police Department, and the Pleasant Grove Police Department. Assistant U.S. Attorney Michelle Rodriguez is prosecuting the case.
Brown is scheduled to be sentenced by U.S. District Judge Kimberly J. Mueller on April 18, 2018. Brown faces a maximum statutory sentence of 20 years in prison and a $250,000 fine for each count. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Mother and daughter from Beachwood charged with stealing the identities of more than a dozen people and filing false tax returnsRead the Press Release
A mother and daughter from Beachwood were charged in a 29-count federal indictment with stealing the identities of more than a dozen people and filing false tax returns, said U.S. Attorney Justin E. Herdman and IRS Special Agent in Charge Ryan L. Korner.
Aesha Johnson, 40, and Brittany Williams, 23, were each indicted on one count of conspiracy to commit wire fraud, 14 counts of wire fraud and 14 counts of aggravated identity theft.
Williams and Johnson, when she was living in West Virginia, conspired together to use stolen identities to file false tax returns with the IRS, seeking tax refunds. Johnson acquired many of these identities through a previous criminal fraud scheme, according to the indictment.
Johnson and Williams used an address associated with the family on East 142nd Street in Cleveland as the address of record for many of the false tax returns. They often communicated with each other using a code that referred to the victims using numbers 1 through 31, and created and used fictitious email accounts in the names of the victims to communicate with the IRS, according to the indictment
Williams filed the false tax returns online, obtained prepaid debit cards in the names of the identity-theft victims and requested the IRS deposit the refunds onto those cards. Williams then withdraw cash or made purchases with the cards, according to the indictment.
“This pair stole people’s identities then used it to steal from taxpayers,” Herdman said.
“Tax season is almost here and the indictment of Aesha Johnson and Brittany Williams for committing aggravated identity theft is a powerful reminder of what can happen when you decide to steal from honest taxpayers and the IRS,” Korner said. “Filing fraudulent tax returns in the names of other individuals may result in significant harm to those individuals whose identities were stolen, as well as a monetary loss against the U.S. Treasury."
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant U.S. Attorneys Chelsea Rice and Matthew Cronin following an investigation by the IRS.
An indictment is only a charge and is not evidence of guilt. The defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Moreland Hills physicians indicted on charges of performing unnecessary medical tests and procedures, overbilling insurance providers and illegally distributing opioids and other drugsRead the Press Release
A Moreland Hills couple was charged in a 24-count indictment with ordering and performing unnecessary tests and procedures to defraud insurance providers, as well as illegally distributing opioids and other drugs, law enforcement officials said.
Drs. Ashis K. Rakhit, 65, and Jayati Gupta Rakhit, 56, were indicted on one count of conspiracy to commit health care fraud, 11 counts of health care fraud and six counts of false statements relating to health care matters. They are both charged with three counts each of distribution of controlled substances.
The Rakhits, who are married, were both medical doctors who specialized in cardiovascular disease and internal medicine. They both had privileges at St. Vincent Charity Medical Center and operated Ohio Cardiology Associates, Inc., which had locations at 2322 East 22nd Street in Cleveland, 10850 Pearl Road in Strongsville and 6789 Ridge Road in Parma. Ashis Rakhit also practiced at 7211 Broadway Ave. in Cleveland, according to the indictment.
The Rakhits ordered and performed unnecessary medical tests between 2011 and 2018, including but not limited to unnecessary nuclear stress tests, cardiac catheterizations, bone density scans, echocardiograms, EKGs, carotid artery scans, venous ultrasounds of the legs and abdominal ultrasounds, according to the indictment.
They also recorded false symptoms in patient records to justify medically unnecessary tests on patients, including shortness of breath, palpitations, hypertension and abnormalities in breathing, according to the indictment.
The Rakhits billed Medicare, Medicaid and private insurers with inflated codes to reflect a service more costly than that which was actually performed, according to the indictment.
The Rakhits also intentionally distributed and dispensed controlled substances outside the usual course of medical practice. Ashis Rakhit is charged with distributing Percocet and Xanax in 2017, while Jayati Rakhit is charged with distributing Tramadol, according to the indictment.
“This couple violated the trust of their patients, the taxpayers and the community,” U.S. Attorney Justin E. Herdman said. “They performed unnecessary medical tests and billed for services they didn’t actually provide in exchange for prescription medications – all of this at a time when our region is inundated in opioid deaths and addiction.”
“Not only did these physicians put their patients through unnecessary medical procedures so they could line their pockets with extra income, they also prescribed controlled narcotics that were not medically required,” said FBI Special Agent in Charge Stephen D. Anthony. “Given the current opioid epidemic, prescribing unnecessary narcotics only further contributes to this crisis. The FBI will continue to work with our partners to hold accountable those in the medical field who choose to engage in criminal activity.”
“The submission of claims for up-coded, inflated, or medically unnecessary services to Medicare or Medicaid is illegal,” said Lamont Pugh III, Special Agent in Charge, U.S. Department of Health & Human Services, Office of Inspector General – Chicago Region. “Providing medically unnecessary procedures and tests is of great concern as it can compromise a patient’s health and safety. The OIG will continue to work with our law enforcement partners to identify these types of improper practices and will take action to protect the health and welfare of patients and taxpayer dollars.”
“I am pleased that my office’s Medicaid Fraud Control Unit was able to assist in the investigation that led to these indictments,” said Ohio Attorney General Mike DeWine. “We will continue to go after those who contribute to our state’s opioid crisis by illegally distributing opiates and defrauding insurers through inflated insurance claims.”
DEA Special Agent in Charge Timothy Plancon said: “The Drug Enforcement Administration has made it a priority to address the dangerous practice of illegally diverting prescription medications. The successful investigation into Ashis Rakhit and Jayati Gupta Rakhit is just one example of DEA's determination to combat the troubling prescription drug abuse problem in this country. These doctors violated the public trust by ordering unnecessary medical procedures and illegally diverting prescription drugs in northern Ohio. The indictments of the Rakhits makes it clear that the DEA, and our partners, will continue to bring those responsible for the illegal distribution of prescription medicines to justice.”
The investigation is ongoing. If you or someone you know may be a victim of these allegations, or if you have information that may be relevant to these allegations, please contact the FBI at 216-583-5328.
If convicted, the defendants’ sentences will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant U.S. Attorneys Michael L. Collyer and Chelsea Rice following an investigation by the Federal Bureau of Investigation, U.S. Department of Health and Human Services – Office of Inspector General, Ohio Attorney General’s Medicaid Fraud Control Unit and the Drug Enforcement Administration.
An indictment is only a charge and is not evidence of guilt. The burden of proof is always on the government to prove a defendant guilty beyond a reasonable doubt.
Monroe County Man Sentenced for Sawed Off Shotgun OffensesRead the Press Release
Donald S. Boyce, United States Attorney for the Southern District of Illinois, announced today that James C. Voss, 25, of Waterloo, IL, was sentenced to 37 months of imprisonment on January 19, 2018 for unlawful possession of a sawed-off shotgun and felon in possession of a firearm. Voss will also have to serve a term of two years of supervised release after he is released from prison.
At his change of plea hearing on September 22, 2017, Voss admitted that he had used a sawed-off shotgun to kill a neighbor’s cat, and that he had been previously convicted of burglary, a felony offense, in Monroe County in 2011.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.
The investigation which resulted in Voss’s arrest and conviction was conducted by the Monroe County Sheriff’s Department and by the federal Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant United States Attorney Robert L. Garrison.
Middlesex County, New Jersey, Duo Charged with Credit Card Fraud and Aggravated Identity Theft ConspiracyRead the Press Release
NEWARK, N.J. – A man and woman from Middlesex County, New Jersey, were arrested today for their alleged participation in a credit card fraud and aggravated identity theft conspiracy, U.S. Attorney Craig Carpenito announced.
Henry Abdul, 30, and Alexus Omowole, 22, both of North Brunswick, New Jersey, are each charged by complaint with one count of bank fraud conspiracy and one count of aggravated identity theft. Abdul and Omowole are expected to make their initial appearances this afternoon before U.S. Magistrate Judge Joseph A. Dickson in Newark federal court.
According to the complaint:
Between October 2015 and the present, Abdul and Omowole participated in a conspiracy to obtain control of and use credit card accounts of others through a fraudulent scheme commonly referred to as a “credit card takeover” scheme. A person who is not the account owner or authorized user of a credit card account contacts the financial institution and poses as the account owner in order to change the personal information associated with the account to information familiar to the criminal. The information changed may include the residence, email address, or telephone number associated with the account. These changes to the account are designed to give the criminal control of the account without the actual account owners’ knowledge or authorization, and may permit the criminal to receive new credit cards associated with the compromised accounts. Once in control of the account, the criminals profit by using the compromised accounts to make purchases, transfer funds to other accounts under the criminal’s control, or sell the account information to third parties.
In this case, Abdul’s residential address was used as part of the takeover conspiracy, and both Abdul and Omowole profited from the conspiracy by using several compromised credit cards at various retail locations in New Jersey and elsewhere.
The bank fraud conspiracy charge carries a maximum potential penalty of 30 years in prison and a fine of up to $1 million. The aggravated identity theft charge carries a mandatory sentence of two years in prison, which must run consecutive to any other term of imprisonment imposed by the Court.
U.S. Attorney Carpenito credited special agents with the U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), under the direction of Acting Special Agent in Charge Michael McCarthy in Newark, New Jersey; and the U.S. Postal Inspection Service under the direction of Acting Inspector in Charge Ruth M. Mendonca, with the investigation leading to today’s arrests.
The government is represented by Assistant U.S. Attorneys David M. Eskew and Nicholas Grippo of the U.S. Attorney’s Office Criminal Division in Newark.
The charges and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty
Mexican National Charged with Illegal ReentryRead the Press Release
U.S. Attorney Duane A. Evans announced that GUADALUPE HERRERA-PEREZ, age 41, a citizen of Mexico, was charged yesterday in a one-count bill of information with illegal reentry of a removed alien after deportation, in violation of 8 U.S.C. '' 1326(a) and (b)(2).
According to the bill of information, GUADALUPE HERRERA-PEREZ reentered the United States prior to on or about November 26, 2017, after having been previously removed therefrom on or about January 28, 1998.
If convicted, GUADALUPE HERRERA-PEREZ faces a maximum term of imprisonment of twenty 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 United States Department of Homeland Security, Immigration and Customs Enforcement in investigating this matter. Assistant United States Attorney Irene González is in charge of the prosecution.
Member of Taunton Drug Conspiracy Sentenced for Distributing Heroin and FentanylRead the Press Release
BOSTON – A former resident of Providence, R.I., was sentenced yesterday in federal court in Boston for his role in a heroin and fentanyl trafficking organization that operated in Taunton and Boston.
Jose Arias, 22, was sentenced by U.S. District Court Judge Leo T. Sorokin to five years of probation. In October 2017, Arias pleaded guilty to one count of conspiracy to distribute and possess with intent to distribute heroin and fentanyl. In February 2017, Arias was arrested and charged along with 22 co-defendants.
From mid-2016 through February 2017, federal law enforcement investigated two drug trafficking organizations operating in Taunton and Boston. Fernando Hernandez ran a heroin and fentanyl trafficking organization in Taunton, assisted by Arias, his son. The organization sold heroin and fentanyl to customers who re-distributed the drugs. It is alleged that Hernandez obtained drugs from a network of suppliers that included Jose Antonio Lugo-Guerrero, 32, a Dominican national who remains a fugitive, who operated a drug trafficking organization in Fall River and Boston.
Hernandez pleaded guilty in November; his sentencing is scheduled for Feb. 7, 2018.
United States Attorney Andrew E. Lelling; Michael Ferguson, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; Colonel Kerry A. Gilpin, Superintendent of the Massachusetts State Police; Fall River Police Chief Daniel S. Racine; New Bedford Police Chief Joseph C. Cordeiro; Taunton Police Chief Edward James Walsh; Boston Police Commissioner William B. Evans; and Bristol Country District Attorney Thomas M. Quinn made the announcement today. Assistant U.S. Attorney Theodore B. Heinrich of Lelling’s Narcotics and Money Laundering Unit prosecuted the case.
The details contained in the charging documents are allegations. The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Man Sentenced to 25 Years in Prison for 3 CarjackingsRead the Press Release
SAN JUAN, P.R. – Today, U.S. District Court Judge Francisco A. Besosa sentenced Bernard Díaz-Pérez to 25 years in prison for committing three carjackings, announced United States Attorney Rosa Emilia Rodríguez-Vélez. The Federal Bureau of Investigation investigated the carjackings. Díaz-Pérez had plead guilty to the three carjackings on February 28, 2017.
According to court documents, on or about June 2, 2016, Bernard Díaz-Pérez and Jessenia Salgado-Ortiz, aiding and abetting each other, with the intent to cause death and serious bodily harm, did take a motor vehicle, to wit: a red 2008 Scion, model XD, that had been transported, shipped or received in interstate or foreign commerce, from the presence of F.N.R. and another female friend. During the carjacking, Díaz-Pérez sexually assaulted one of the victims. He also ordered the victims to move to the front passenger seat and then started to drive away from the location. The victims had to jump from the moving vehicle in order to escape the carjacking.
His co-conspirator, Jessenia Salgado-Ortiz also pled guilty on February 28, 2017. She was sentenced on August 8, 2017 to 71 months in prison.
Díaz-Pérez was also sentenced for two other carjackings which occurred on May 15 and 27, 2016, respectively. During both incidents, Diaz-Pérez forced the victims out of the cars using threats and a replica gun.
The case was prosecuted by Assistant United States Attorney Max Pérez Bouret.
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Machesney Park Man Charged in Federal Court with Armed RobberiesRead the Press Release
ROCKFORD — A Machesney Park man was indicted Tuesday by a federal grand jury in Rockford for the armed robberies of a convenience store and a bank.
DAVID M. BANEY, 32, was charged with one count of armed robbery, one count of armed bank robbery, and two counts of using and carrying a firearm during a crime of violence. According to the indictment, on Jan. 11, 2018, Baney used a semi-automatic pistol to rob Kelley’s Market/Mobil gas station on North Second Street in Machesney Park, of $170 in cash and two cartons of cigarettes. The indictment further alleges that on the same day Baney used a revolver to rob a Chase Bank on North Alpine Road in Loves Park, of $24,402.
Baney is currently in custody at the Winnebago County Jail on state charges related to the robbery of Kelley’s Market. He will appear in federal court in Rockford today at 10:00 a.m. for an initial appearance before U.S. Magistrate Judge Iain D. Johnston.
Armed bank robbery carries a maximum potential penalty of up to 25 years in prison, to be followed by up to five years of supervised release, while armed robbery carries a maximum potential penalty of up to 20 years in prison, to be followed by up to three years of supervised release. The first charge of using and carrying a firearm during a crime of violence carries a minimum consecutive sentence of seven years in prison, and the second charge of using and carrying a firearm during a crime of violence carries a minimum consecutive sentence of 25 years in prison. Each charge also carries a fine of up to $250,000. If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines, and order the defendant to pay full restitution to Kelley’s Market/Mobile gas station and Chase Bank.
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The investigation was conducted by the FBI-led Rockford Area Violent Gang Task Force consisting of law enforcement officers and agents from the FBI, Rockford Police Department, Loves Park Police Department, and Freeport Police Department. Officers from the Loves Park Police Department and the Winnebago County Sheriff’s Department participated in the investigation.
The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Jeffrey Sallet, Special Agent-in-Charge of the Chicago Field Office of Federal Bureau of Investigation; Gary Caruana, Winnebago County Sheriff; and Chuck Lynde, Chief of the Loves Park Police Department.
The government is represented by Assistant U.S. Attorney John G. McKenzie.
Louisville Convicted Felon Sentenced to 110 Months for Threatening to Kill A Louisville Metro Intelligence (LM INTEL) Joint Task Force Member and Multiple Firearm ViolationsRead the Press Release
LOUISVILLE, Ky. – United States Attorney Russell M. Coleman today announced the sentence of a Louisville convicted felon, in United States District Court, by Senior Judge Thomas B. Russell, to 110 months in prison, followed by a three year period of supervised release, for threatening to kill a Louisville Metro Police Officer while engaged in the performance of his official duties, and for several firearms violations. There is no parole in the federal system.
“Threaten a federal task force member engaged in protecting this city and go to federal prison, period,” stated United States Attorney Russell Coleman. “Today’s nine year sentence is well-earned.”
Roman L. Brown, 26, admitted in court, that on April 12, 2017, he threatened to assault and threatened to kill an LM Intel Joint Task Force member, in order to impede, interfere, intimidate and retaliate against the LM Intel member while he was engaged in the performance of his duty. Further, on the same day, Brown threatened to assault a member of the immediate family of the LM Intel Joint Task Force member, while he was engaged in the performance of his official duty.
Brown further admitted to being a convicted felon in possession of a Glock Model 36, .45 caliber pistol, and a Zastava, AK-style 7.62 caliber pistol. While fleeing from police, Brown attempted to conceal his possession of the loaded AK-style 7.62 caliber pistol, by throwing it out the window of a moving vehicle. Brown was convicted in Jefferson County Circuit Court of Trafficking in a Controlled Substance First Degree, on September 18, 2013.
Brown was indicted with co-defendant Chicoby Summers. Both defendants were charged with counts of being a convicted felon in illegal possession of firearms. The charges against Summers are pending.
Louisville Metro Intel (LM Intel) is an intelligence-led task force which identifies serious, violent offenders and leverages all available resources to investigate, apprehend and prosecute these offenders. The LM Intel Joint Task Force was announced in January of 2017, and includes the United States Attorney’s Office, federal investigative agencies, state prosecutors and Louisville Metro Police.
This case was prosecuted by Assistant United States Attorneys Erin G. McKenzie and Nute Bonner, and was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Louisville Metro Police Department.
Long Island Man Sentenced to Eight Years’ Imprisonment for Downloading Child PornographyRead the Press Release
Earlier today in federal court in Central Islip, Christopher Robert Grief, also known as “Mookie,” was sentenced to eight years’ imprisonment following his June 15, 2017 guilty plea to Receiving Child Pornography in Interstate and Foreign Commerce. The sentencing proceeding was held before United States District Judge Joseph F. Bianco. Grief was also sentenced to lifetime supervised release to follow his prison sentence, during which time he must register as a sex offender and he will not be allowed unsupervised contact with minors.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and John W. Barry, Acting Commissioner, Suffolk County Police Department (SCPD), announced the sentence.
According to court filings, Grief, who used the online identity “Mookie,” frequented online “Dark Web” forums devoted to the sexual torture of infants and toddlers. At the time of his arrest in September 2014, when a search warrant was executed on his residence, Grief admitted that he had a sexual interest in young children. He also admitted that he had been using the dark web forum for about a year to post and download child pornography and to chat about torture of children and animals. Grief further admitted that he had made and posted to the online forum a mutilation and torture video where he had abused a rat. Law enforcement recovered child pornography, including a video of the rape of a three-month-old baby on Grief’s computer. Grief has been incarcerated since his arrest.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorney Allen L. Bode is in charge of the prosecution.
The Defendant:
CHRISTOPHER ROBERT GRIEF (also known as “Mookie”)
Age: 30
Ridge, New YorkE.D.N.Y. Docket No. 14-CR-555
Lindsey Johnson Carjacking Conviction AffirmedRead the Press Release
Jackson, Miss. - In a published opinion issued yesterday, the United States Court of Appeals for the Fifth Circuit affirmed the carjacking and firearms convictions and sentence of Lindsey Johnson, announced U.S. Attorney Mike Hurst.
A federal grand jury previously returned a three-count indictment against Johnson, charging him with carjacking, being a felon in possession of a firearm, and brandishing a firearm during a crime of violence, stemming from an incident occurring in Jackson, Mississippi, on August 2, 2015.
In May 2016, Johnson was prosecuted for these crimes in Jackson before Senior U.S. District Judge William H. Barbour. A jury found Johnson guilty on all counts. Johnson was subsequently sentenced to 180 months of in prison, followed by three years of supervised release.
Johnson appealed to the Fifth Circuit Court of Appeals, challenging his conviction and sentence, arguing that the trial court had erred in denying the admission of evidence during trial, penalizing him during sentencing by finding that he had lied on the stand, and categorizing his prior convictions as crimes of violence resulting in an enhanced sentence. Johnson also argued that the prosecutor violated the law by cross-examining Johnson about his prior convictions.
In its ruling, the U.S. Court of Appeals for the Fifth Circuit upheld Johnson’s conviction and sentence. The Court denied Johnson’s first argument, holding that it could not conclude that admitting the evidence Johnson requested (Facebook posts) would have had a substantial impact on the jury’s ultimate verdict. The Court also upheld the district court’s finding that Johnson had lied on the stand and thus qualified for a higher sentence. In addition, the Court sustained the trial court’s finding that Johnson’s two prior state convictions for carjacking qualified for an increased sentence as a crime of violence.
Finally, the Court held that the prosecutor’s reference to the number of Johnson’s prior convictions did not violate the law and Johnson had failed to prove that he had suffered prejudice sufficient to require a new trial.
The case was investigated by the Jackson Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted at trial by Assistant United States Attorneys Abe McGlothin and Darren LaMarca. Assistant U.S. Attorney Gaines Cleveland handled the appeal.
US v Lindsey Johnson CA5Las Cruces Man Pleads Guilty to a Federal Methamphetamine Trafficking ChargeRead the Press Release
ALBUQUERQUE – Gilberto Garcia, 42, of Las Cruces, N.M., pled guilty this morning in federal court to a methamphetamine trafficking charge under a plea agreement with the U.S. Attorney’s Office.
Garcia was arrested in Oct. 2017, on a criminal complaint charging him with possessing methamphetamine with intent to distribute. According to the complaint, law enforcement officers seized approximately 128 gross grams of methamphetamine from Garcia’s vehicle following a routine traffic stop on May 10, 2017, in Dona Ana County, N.M.
During today’s proceedings, Garcia pled guilty to a felony information charging him with possessing methamphetamine with intent to distribute. In entering the guilty plea, Garcia admitted that on May 10, 2017, Las Cruces Police Department officers seized approximately 80.5 grams of pure methamphetamine from Garcia following a traffic stop on the vehicle Garcia was driving based on a license plate violation. Garcia admitted that he intended to distribute the methamphetamine to others.
At sentencing, Garcia faces a mandatory minimum penalty of ten years and a maximum of life in federal prison. He remains in custody pending a sentencing hearing, which has yet to be scheduled.
This case was investigated by the Las Cruces offices of the DEA and FBI and the Las Cruces Police Department. Assistant U.S. Attorney Renee L. Camacho of the U.S. Attorney’s Las Cruces Branch Office is prosecuting the case.
Kittrell Man Sentenced for Felon in Possession of a Firearm ChargeRead the Press Release
RALEIGH – The United States Attorney for the Eastern District of North Carolina, Robert J. Higdon, Jr., announced that today in federal court, United States District Judge Terrence W. Boyle sentenced JOHNNIE O’NEIL LEWIS, 35, of Kittrell, North Carolina to 60 months of imprisonment followed by 3 years of supervised release.
LEWIS was named in an Indictment filed on August 8, 2017. On October 18, 2017, LEWIS subsequently pled guilty to being a Felon in Possession of a Firearm and Ammunition.
On June 1, 2017, the Henderson Police Department (HPD) responded to a call regarding an intoxicated individual, later determined to be LEWIS, who was shooting a gun in a residential neighborhood of Henderson. The HPD encountered LEWIS, a convicted felon, walking in the middle of the roadway, holding his hand near his waistband. LEWIS was observed with his hand on a pistol in his waistband and was issued repeated commands to stop moving; however, LEWIS failed to comply with the directives and fled on foot. A brief foot chase ensued, but officers were able to apprehend LEWIS without further resistance.
Upon his arrest, the HPD located a pistol approximately twenty feet from where LEWIS was arrested. Additionally, a handgun magazine was lying on the ground next to LEWIS, who also had thirteen rounds of ammunition in his shorts pocket. At the time of his arrest, the HPD smelled a strong odor of alcohol on LEWIS' breath.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.
The Henderson Police Department and the Bureau of Alcohol Tobacco Firearms and Explosives (ATF) conducted the criminal investigation of this case. Assistant United States Attorney S. Katherine Burnette handled the prosecution of this case for the government.
Justice Department Demands Documents and Threatens to Subpoena 23 Jurisdictions as Part of 8 U.S.C. 1373 Compliance ReviewRead the Press Release
The Department of Justice today sent the attached letters to 23 jurisdictions, demanding the production of documents that could show whether each jurisdiction is unlawfully restricting information sharing by its law enforcement officers with federal immigration authorities.
All 23 of these jurisdictions were previously contacted by the Justice Department, when the Department raised concerns about laws, policies, or practices that may violate 8 U.S.C. 1373, a federal statute that promotes information sharing related to immigration enforcement and with which compliance is a condition of FY2016 and FY2017 Byrne JAG awards.
The letters also state that recipient jurisdictions that fail to respond, fail to respond completely, or fail to respond in a timely manner will be subject to a Department of Justice subpoena.
“I continue to urge all jurisdictions under review to reconsider policies that place the safety of their communities and their residents at risk,” said Attorney General Jeff Sessions. “Protecting criminal aliens from federal immigration authorities defies common sense and undermines the rule of law. We have seen too many examples of the threat to public safety represented by jurisdictions that actively thwart the federal government’s immigration enforcement—enough is enough.”
Failure to comply with section 1373 could result in the Justice Department seeking the return of FY2016 grants, requiring additional conditions for receipt of any FY2017 Byrne JAG funding, and/or jurisdictions being deemed ineligible to receive FY2017 Byrne JAG funding.
The following jurisdictions received the document request today:
- Chicago, Illinois;
- Cook County, Illinois;
- New York City, New York;
- State of California;
- Albany, New York;
- Berkeley, California;
- Bernalillo County, New Mexico;
- Burlington, Vermont;
- City and County of Denver, Colorado;
- Fremont, California;
- Jackson, Mississippi;
- King County, Washington;
- Lawrence, Massachusetts;
- City of Los Angeles, California;
- Louisville Metro, Kentucky;
- Monterey County, California;
- Sacramento County, California;
- City and County of San Francisco, California;
- Sonoma County, California;
- Watsonville, California;
- West Palm Beach, Florida;
- State of Illinois; and
- State of Oregon.
Jury Finds Cedar Rapids Man Guilty of Firearms and Narcotics CrimesRead the Press Release
A man who tossed a loaded semi-automatic pistol and a bag of marijuana into a wooded area near the I-380 and Glass Road interchange in Cedar Rapids after a car accident in July 2017 was convicted by a jury today after a three-day trial in federal court in Cedar Rapids.
David Tachay Heard, age 39, from Cedar Rapids, was convicted on all counts, which included possession of a firearm by a felon, possession of a stolen firearm, possession of marijuana with intent to deliver, and possession of a firearm in furtherance of a drug trafficking crime. The verdict was returned this afternoon following about two hours of jury deliberations.
The evidence at trial showed that, on July 30, 2017, Heard ran a red light and crashed into another car at the Glass Road and I-380 Interchange. Heard drove the car to a more secluded spot on Redbud Road and tossed the bag of marijuana and the firearm into the nearby brush. By chance, passerby in a vehicle saw him do so. That passerby called 911. After Heard was arrested, the passerby received calls from a girlfriend of an associate of Heard, telling the passerby that Heard had his name and address.
An investigation revealed that Heard’s cousin purchased the firearm in 2013 from a now-defunct federal firearms licensee in the Cedar Rapids area. Heard’s cousin testified at trial that he did not give Heard permission to use the firearm, because he knew Heard was a felon.
This case is being prosecuted as part of Project Safe Neighborhoods, a cooperative local, state and federal program aimed at the enhanced prosecution of gun crimes. The case was referred to the United States Attorney’s Office by the Cedar Rapids Police Department.
Sentencing before United States District Court Judge Linda R. Reade will be set after a presentence report is prepared. Heard remains in custody of the United States Marshal pending sentencing. Heard faces up to ten years’ imprisonment on three counts and a mandatory consecutive minimum sentence of 25 years’ imprisonment for possessing a firearm in furtherance of a drug trafficking crime. In sum, Heard is subject to a possible maximum sentence of life imprisonment, a $1,250,000 fine, $400 in special assessments, and nine years of supervised release following any term of imprisonment. Heard’s potential punishment was increased because he is a recidivist offender; he was convicted in the United States District Court for the Northern District of Iowa in 2000 on two counts of possession of a firearm in furtherance of a drug trafficking crime and possession of marijuana with intent to deliver, respectively.
The case is being prosecuted by Assistant United States Attorney Timothy L. Vavricek and Lyndie M. Freeman and was investigated by the Federal Bureau of Investigation, the Cedar Rapids Police Department, and the Bureau of Alcohol, Tobacco, and Firearms.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 17-CR-83-LRR.
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Jury Convicts Panama City Beach Man of Online Child Exploitation OffensesRead the Press Release
PANAMA CITY, FLORIDA – After a one and a half day trial, Brandon Royce Phillips, 34, of Panama City Beach, was convicted yesterday in the U.S. District Court in Panama City of production, receipt, and possession of child pornography. The verdict was announced by Christopher P. Canova, United States Attorney for the Northern District of Florida.
During November 2016, the grandmother of a 14-year-old boy advised the Clay County Sheriff’s Office that an unknown person had sent the boy sexually graphic videos during chats on Kik, a social media application. The investigation disclosed that Phillips, posing as a 17-year-old female named “Katie Davis,” had sent the boy pornographic videos of a female that Phillips claimed to be “Davis.” Phillips then convinced the boy to take sexually explicit videos of himself and send them to Phillips via Kik. Further investigation revealed videos of other children engaged in the same sexually explicit conduct.
Phillips faces a minimum of 15 years and a maximum of 30 years in prison for production of child pornography, a minimum of 5 years and a maximum of 20 years in prison for receipt, and a maximum of 20 years’ imprisonment for possession. The sentencing hearing is scheduled for April 10, at 2:00 p.m. at the United States Courthouse in Panama City.
The case is being investigated by United States Immigration and Customs Enforcement Homeland Security Investigations, the Bay County Sheriff’s Office, and the Clay County Sheriff’s Office. The case is being prosecuted by Assistant United States Attorney Christopher J. Thielemann.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
Jefferson City Business Owner Indicted for Tax Evasion, Failure to Pay $400,000 in Payroll TaxesRead the Press Release
JEFFERSON CITY, Mo. – Timothy A. Garrison, United States Attorney for the Western District of Missouri, announced today that a Jefferson City, Mo., business owner has been indicted by a federal grand jury for tax evasion and for failing to pay over more than $400,000 in payroll taxes.
Gina Marie Volmert, 53, of Jefferson City, was charged in an 11-count indictment returned under seal by a federal grand jury in Jefferson City on Jan. 17, 2018. That indictment was unsealed and made public today upon Volmert’s arrest and initial court appearance.
Volmert is the majority owner and operator of GVA and Associates, LLC, in Jefferson City. GVA provides medical billing and coding services for the electronic submission of medical claims.
According to the federal indictment, GVA withheld payroll taxes from its employees’ paychecks. However, from 2012 through 2014, GVA allegedly made only partial payments to the IRS. Volmert is charged with eight counts of failing to pay over to the IRS a total of $403,912 in payroll taxes.
Volmert is also charged with three counts of tax evasion. In 2012, 2013 and 2014, the indictment alleges, Volmert decreased her reported income by fraudulently shifting her income to reimbursable expenses. Volmert fraudulently submitted $6,300 in reimbursable expenses every two weeks in order to conceal her income, according the indictment, which caused her income to be falsely reported on her W-2 to the IRS.
Garrison cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Jim Lynn. It was investigated by the Department of Labor, Office of Inspector General – Office of Investigations and IRS-Criminal Investigation.
Illegal Alien Sentenced to 262 Months in Federal Prison for Drug ConspiracyRead the Press Release
Jackson, Miss. – Jose Christian Nunez-Belemontes, 33, an illegal alien from Mexico living in Jackson, was sentenced yesterday by Senior U.S. District Judge William H. Barbour, Jr., to 262 months in federal prison, followed by four years of supervised release, for conspiracy to possess with intent to distribute 500 grams or more of cocaine, announced U.S. Attorney Mike Hurst.
Nunez-Belemontes was charged after a lengthy investigation into a drug trafficking organization operating in Jackson. As part of the investigation, agents were able to link $105,108 in U.S. Currency and three kilograms of cocaine to the defendant. Agents also seized approximately $192,000, a money counter, and more than 400 grams of cocaine from the defendant’s residence.
The case was investigated by the Drug Enforcement Administration, the Mississippi Bureau of Narcotics, and the Bureau of Alcohol Tobacco Firearms and Explosives, with assistance from: the Hinds County Sheriff’s Office; the Ridgeland Police Department; the Jackson Police Department; the U.S. Marshals Service; the Federal Bureau of Investigation; the Mississippi Highway Patrol; the Madison County Sheriff’s Office; the Brandon Police Department; the Rankin County Sheriff’s Office; the Mississippi Department of Corrections; the Pearl Police Department; the Flowood Police Department; U.S. Customs and Border Protection; and the Drug Enforcement Administration - Houston Field Division.
The case was prosecuted by Assistant United States Attorney Christopher L. Wansley.
Illegal Alien Pleads Guilty to Conspiracy to Smuggle Other Illegal AliensRead the Press Release
Gulfport, Miss. – Luis Enrique Moran-Vargaz, 37, a citizen of Mexico, pled guilty yesterday before U.S. District Judge Sul Ozerden to conspiracy to transport illegal aliens within the United States, announced U.S. Attorney Mike Hurst and Joseph Banco, Chief Patrol Agent of the U.S. Border Patrol’s New Orleans Sector.
Moran-Vargaz will be sentenced by Judge Ozerden on Monday, April 23, 2018 at 9:00 a.m. He faces a potential maximum 10 years imprisonment, not more than 3 years supervised release, a maximum $250,000 fine, and special assessments that could total $5,100.
On November 28, 2017, a truck driven by Moran-Vargaz was stopped by a Gautier police officer on Interstate-10 in Jackson County, Mississippi, for speeding. While the truck was designed to seat five people, the police officer observed that, in addition to the driver, there were six additional people in the vehicle. These passengers provided Mexican identification documents and they could not be identified by Moran-Vargaz. The U.S. Border Patrol was notified, and a Border Patrol Agent responded to the scene.
During the investigation, it was determined that none of the passengers had proper documentation and all were illegally present in the United States. The six passengers were being smuggled by Moran-Vargaz, whom also was determined to be an illegal alien. All occupants of the vehicle were arrested. Moran-Vargaz confirmed that he knew his passengers were illegal aliens and admitted that he was being paid to transport them from Texas.
"This office will aggressively pursue individuals who perpetuate and exacerbate the problem of illegal immigration in this country by attempting to profit from human smuggling. Our local and federal law enforcement officers should be commended for their cooperative efforts in this case. It is only through our work together that the American public is best served, the rule of law is upheld, and justice is done," said U.S. Attorney Hurst.
New Orleans Sector Border Patrol Chief Joseph Banco stated: "The New Orleans Border Patrol Sector’s efforts with its federal, state and local law enforcement partners reduces the ability of criminal organizations to exploit transportation routes within the area and degrades their ability to conduct criminal acts."
U.S. Attorney Hurst praised the cooperation exhibited by the U.S. Department of Homeland Security, the U.S. Border Patrol, and the Gautier Police Department. Assistant United States Attorney Stan Harris is the prosecutor for the case.
Illegal Alien Felon Pleads Guilty to Illegally Reentering United StatesRead the Press Release
Gulfport, Miss. – Juan Antonio Martinez-Alonso, 50, a citizen of Mexico, pled guilty yesterday before U.S. District Judge Sul Ozerden to the crime of unlawful re-entry by an alien previously convicted of a felony, announced U.S. Attorney Mike Hurst and Joseph Banco, Chief Patrol Agent of the U.S. Border Patrol’s New Orleans Sector.
Martinez-Alonso is scheduled to be sentenced by Judge Ozerden on Monday, April 23, 2018 at 10:30 a.m. He faces a potential maximum 10 years imprisonment, not more than 3 years supervised release, a maximum $250,000 fine, and a special assessment of $100.
On November 28, 2017, a truck in which Martinez-Alonso was a passenger was stopped by a Gautier police officer on Interstate-10 in Jackson County, Mississippi, for speeding. While the truck was designed to seat five people, the police officer observed that, in addition to the driver, there were six additional passengers in the vehicle. The passengers provided Mexican identification documents and they could not be identified by the driver. The U.S. Border Patrol was notified, and a Border Patrol Agent responded to the scene.
During the investigation, it was determined that none of the passengers had proper documentation and all were illegally present in the United States. All six passengers of the vehicle were arrested. Further investigation revealed that one of the passengers, Martinez-Alonso, had been previously convicted in the United States District Court for the District of New Mexico of the offense of Re-entry by a Removed Alien, a felony.
U.S. Attorney Hurst praised the cooperation exhibited by the Department of Homeland Security, the U.S. Border Patrol, and the Gautier Police Department. Assistant United States Attorney Stan Harris is the prosecutor for the case.
New Orleans Sector Border Patrol Chief Joseph Banco stated: "Our goal is to enhance border security in the Gulf Coast region in order to disrupt and degrade smuggling operations."
Hartford Man Sentenced to 5 Years in Federal Prison for Role in Heroin Trafficking RingRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that MARCUS TYSON, 32, of Hartford, was sentenced today by U.S. District Judge Alvin W. Thompson in Hartford to 60 months of imprisonment, followed by four years of supervised release, for his role in a heroin distribution ring.
According to court documents and statements made in court, in 2016, the East Hartford Police Department received information that individuals were packaging and selling heroin from an apartment at 50 Forest Street in Hartford, and that there were guns in the apartment. A law enforcement investigation in August and September 2016 confirmed drug activity at the location.
On September 13, 2016, members of the Hartford Police Department, East Hartford Police Department and the FBI’s Northern Connecticut Violent Crimes Task Force executed a search warrant at the apartment and encountered TYSON, Byron Rivera and Ronald Perez inside. A search of the apartment revealed more than 39,000 bags of heroin, approximately 283 grams of unpackaged heroin, three fentanyl patches, scales and other items used in the processing and packaging of heroin, two handguns and numerous rounds of ammunition. TYSON, Rivera and Perez were arrested at that time.
On June 2, 2017, TYSON pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, 100 grams or more of heroin. Rivera and Perez also have pleaded guilty. On August 29, 2017, Rivera was sentenced to 60 months of imprisonment. Perez awaits sentencing.
The FBI Task Force includes members of the U.S. Marshals Service, Hartford Police Department, East Hartford Police Department, Connecticut State Police and Connecticut Department of Correction. This case is being prosecuted by Assistant U.S. Attorney Brian P. Leaming.
Georgia Woman Sentenced After Pleading Guilty to Methamphetamine Conspiracy ChargeRead the Press Release
U.S. Attorney Duane A. Evans announced that U.S. District Judge Martin L. C. Feldman sentenced LORI DEXTER, age 53, of Decatur, Georgia, to 60 months’ imprisonment after pleading guilty to one count of conspiracy to distribute and possess with intent to distribute a quantity of methamphetamine.
According to court documents, on September 7, 2013, DEXTER and an associate, James Woolf, agreed to drive from Georgia to Metairie, Louisiana to deliver one-half pound of methamphetamine to an undercover agent. After DEXTER and Woolf arrived in Metairie, law enforcement officers conducted a traffic stop of their vehicle. During a search of the vehicle, Drug Enforcement Administration Agents found approximately 600 grams of a methamphetamine cutting agent. After obtaining a search warrant for DEXTER and Woolf’s hotel room, agents searched the room and found 250 grams of methamphetamine.
U.S. Attorney Evans praised the work of the Drug Enforcement Administration in investigating this matter. Assistant United States Attorney Andre’ Jones was in charge of the prosecution.
Gansevoort Man Arrested for Distribution and Possession of Child PornographyRead the Press Release
ALBANY, NEW YORK – Joshua Brackett, age 33, of Gansevoort, New York, was ordered detained on Monday following his January 19 arrest on charges of distributing and possessing child pornography.
The announcement was made by United States Attorney Grant C. Jaquith and Vadim D. Thomas, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).
The complaint filed against Brackett alleges that he distributed and possessed child pornography on a homemade desktop computer that has peer-to-peer file-sharing software. The charges in the complaint are merely accusations. The defendant is presumed innocent unless and until proven guilty.
If convicted on all charges, Brackett faces at least 5 years and up to 20 years in prison, a maximum $250,000 fine, and a term of post-imprisonment supervised release of at least 5 years and up to life. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors. If convicted, Brackett would also have to register as a sex offender.
This case is being investigated by the FBI and is being prosecuted by Assistant U.S. Attorney Emmet O’Hanlon.
This case is being prosecuted as part of Project Safe Childhood. Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), and is designed to marshal 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 https://www.justice.gov/psc.
Former Supervisory Deputy Jailer at Kentucky River Regional Jail Pleads Guilty to Assaulting an InmateRead the Press Release
LEXINGTON, Ky. – A former supervisory deputy jailer at an Eastern Kentucky detention center has entered a guilty plea to a federal charge related to his role in an unprovoked violent assault of a detainee.
Matthew B. Amburgey, 29, entered his guilty plea today, before U.S. District Chief Judge Karen K. Caldwell.
In his plea, Amburgey admitted that, on October 10, 2011, he used excessive force against a pretrial detainee at the Kentucky River Regional Jail, after he witnessed another Supervisory Deputy Jailer, Damon Hickman, assault the inmate without justification during the booking process. Hickman punched the inmate on the side of his head with such force that it broke his hand and caused the inmate’s ear to bleed. Amburgey and other deputies then knocked the inmate to the ground and repeatedly kicked him. Amburgey admitted that he kicked the inmate without justification.
The Kentucky River Regional Jail houses pre-trial detainees from Perry and Knott Counties. As a supervisory deputy jailer, Amburgey was responsible for the custody, care, safety and control of the inmates at the jail.
Hickman pleaded guilty last year for his role in a separate assault at the same jail. The victim of that assault died.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; John M. Gore, Acting Assistant Attorney General for the Civil Rights Division; and Amy Hess, Special Agent in Charge, Federal Bureau of Investigation, jointly made the announcement.
The investigation was conducted by the FBI. Assistant U.S. Attorney Hydee Hawkins of the United States Attorney’s Office and Trial Attorney Sanjay Patel of the Civil Rights Division prosecuted this case on behalf of the federal government.
Sentencing for Amburgey is scheduled for April 12, 2018 at 1:00 pm. He faces up to 12 months imprisonment. The U.S. District Court will consider the U.S. Sentencing Guidelines and the federal statutes before imposing sentence.
Former IRS Employee Charged with Impersonating A Federal OfficerRead the Press Release
NEWARK, N.J. – A former IRS attorney appeared in federal court today to face charges related to his alleged unauthorized use of a federal agency identification card during multiple traffic stops, U.S. Attorney Craig Carpenito announced.
Deon Owensby, 42, of Trenton, New Jersey, is charged by criminal complaint with one count of impersonating a federal officer and one count of possessing an official identification card of a federal agency without authorization. He appeared today before U.S. Magistrate Judge Joseph A. Dickson in Newark federal court and was released on $20,000 unsecured bond.
According to the complaint:
From August 2015 to April 2017, after the termination of his employment with the IRS, Owensby allegedly pretended to be an IRS employee and displayed federal employee identification, including an official IRS identification card known as an “IRS Pocket Commission,” to law enforcement officers after committing traffic violations.
Owensby obtained the IRS Pocket Commission during his employment as an attorney with the IRS. The IRS Pocket Commission, which IRS employees use as a means of identifying themselves to the public when performing official duties, was to be returned to the IRS upon the end of his employment in April 2015. However, Owensby told his supervisor that it was stolen.
Afterwards, Owensby allegedly displayed the IRS Pocket Commission or some form of federal employee identification to state or local police on three separate occasions from August 2015 to April 2017 after he was stopped for committing traffic infractions, once by a Millburn police officer and twice by N.J. State Police officers. During one of the encounters, Owensby claimed that the IRS Pocket Commission was still valid even after the police officer pointed out that the expiration date on it had passed.
The count of impersonating a federal officer is punishable by a maximum potential penalty of three years in prison and a $250,000 fine. The count of possessing an official identification card of a federal agency without authorization is punishable by a maximum potential penalty of six months in prison and a $5,000 fine.
U.S. Attorney Carpenito credited special agents of the U.S. Treasury Inspector General for Tax Administration, under the direction of Special Agent in Charge Rodney A. Davis, with the investigation. He also thanked the N.J. State Police, under the direction of Acting Superintendent Col. Patrick J. Callahan, and the Millburn Police Department, under the direction of Chief Brian Gilfedder, for their assistance.The government is represented by Jihee G. Suh of the U.S. Attorney Office’s Special Prosecutions Division in Newark.
The charges and allegations contained in the complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.
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Defense counsel: Patrick McMahon Esq., Assistant Federal Public Defender, Newark
Former Executive of New York Hotel Company Admits Stealing over $13 Million from EmployerRead the Press Release
NEWARK, N.J. – A Passaic County, New Jersey, man today admitted embezzling millions of dollars from a New York-based hospitality company where he was the chief operating officer, U.S. Attorney Craig Carpenito announced.
George Dfouni, 47, of Wayne, New Jersey, pleaded guilty before U.S. District Judge Katharine S. Hayden in Newark federal court to an information charging him with one count of wire fraud and one count of tax evasion. He was released on $150,000 unsecured bond.
According to documents filed in the case and statements made in court:
From 1996 through 2015, Dfouni worked as the chief operating officer for a company identified in the information as “Company A,” which owns and operates hotels in New York and New Jersey.
From 2007 through September 2015, Dfouni negotiated multiple contracts on behalf of Company A, whereby two other companies – identified as “Company B” and “Company C” in the information – leased New York hotel properties from Company A. As consideration for the leases, Company B and Company C agreed to pay millions of dollars to Company A. Each contract included a signing bonus for Dfouni, who arranged for Company B and Company C to transmit their payments directly to him in New Jersey.
Dfouni was expected to keep his signing bonus and pay the remaining balances to Company A. Instead, Dfouni skimmed a portion of the payments due to Company A to support his lavish lifestyle and gambling expenses. In total, Dfouni embezzled approximately $13,807,034 from Company A.
In addition, Dfouni willfully failed to report $27,739,114 in income to the IRS between 2007 and 2014, including the funds that he embezzled from Company A.
The wire fraud charge is punishable by a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. The tax evasion charge is punishable by a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for April 30, 2018.
U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to today’s plea.
The government is represented by Assistant U.S. Attorney Francisco J. Navarro of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Peter Carter Esq., Newark, New Jersey
Former Contractor at Military Sealift Command Pleads Guilty to Conspiracy, Bribery, and Honest Services FraudRead the Press Release
A former contractor at the Military Sealift Command (MSC) pleaded guilty today for accepting bribes totaling approximately $2.8 million in the course of a bribery and fraud scheme that lasted more than a decade.
Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division; U.S. Attorney Dana Boente for the Eastern District of Virginia; Special Agent in Charge Martin Culbreth of the FBI’s Norfolk Field Office; Special Agent in Charge Robert E. Craig, Jr. of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office and Special Agent in Charge Clifton J. Everton, III of the Naval Criminal Investigative Service (NCIS)’s Norfolk Field Office, made the announcement.
Scott B. Miserendino, Sr., 58, formerly of Stafford, Virginia, pleaded guilty before U.S. Magistrate Judge Lawrence R. Leonard of the Eastern District of Virginia to an indictment charging him with one count of conspiracy, one count of bribery, and three counts of honest services mail fraud. Sentencing has been scheduled for May 8 before Chief District Court Judge Rebecca Beach Smith.
For more than a decade, Miserendino was a contractor at the MSC, an entity of the U.S. Department of the Navy that supports and supplies the Navy and other U.S. military forces in their global warfighting and disaster relief missions. According to the plea agreement, Miserendino and Joseph P. Allen, the owner of a government contracting company, conspired to use Miserendino’s position at MSC to enrich themselves through bribery.
Specifically, beginning in about 1999, Miserendino used his position and influence at MSC to help Allen obtain and expand commission arrangements with a telecommunications company from which MSC purchased maritime satellite communications services. Through these arrangements, Allen received a commission based on the amount of services that MSC purchased from the telecommunications company. For more than a decade, Miserendino then used his position and influence at MSC to perform official acts to benefit the telecommunications company, which through the commission agreement also benefitted Allen and his company.
Unknown to MSC or the telecommunications company, throughout the scheme, Allen paid half of the commissions he received from the telecommunications company to Miserendino as bribes. In total, Miserendino received almost $3 million in bribes from Allen between 1999 and 2014.
For his role in the scheme, Allen, 56, formerly of Panama City, Florida, pleaded guilty to one count of conspiracy to commit bribery in April 2017, and was sentenced on July 28, 2017, to five years in prison by U.S. District Judge Arenda L. Wright Allen, in Norfolk.
The FBI, DCIS and NCIS are investigating the case. Trial Attorneys Sean Mulryne and Molly Gaston of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Steve Haynie for the Eastern District of Virginia are prosecuting the case.
Former Bookkeeper Sentenced to 3 Years in Federal Prison for Embezzling over $750,000 and for Submitting False Tax ReturnsRead the Press Release
Anchorage, Alaska – U.S. Attorney Bryan Schroder announced today that an Anchorage woman was sentenced by U.S. District Judge Sharon L. Gleason to serve three years in federal prison for embezzling more than $750,000 from her employer, and for submitting false tax returns to the IRS.
Raenette K. Yangson, 42, of Anchorage, was employed between 2006 and 2012 as a bookkeeper for Western Construction and Equipment, an Anchorage business. Soon after joining the company, Yangson began creating multiple false checks drawn on the business’ bank account which were made payable to herself or to her husband. Yangson then forged the signatures of owners of the business on the checks and made false entries into the business’ computer accounting program to make the checks appear to be legitimate payments to vendors. Yangson continued the scheme for more than six years. Yangson also submitted false income tax returns to the IRS for several years by failing to report the embezzled income.
In addition to the three-year prison sentence, Judge Gleason ordered Yangson to pay $206,987 in restitution to the IRS for taxes owed on the stolen money. The exact amount of the restitution Yangson owes to Western Construction and Equipment will be determined at a later hearing.
Judge Gleason commented that Yangson had seriously abused the trust which Western Construction and Equipment had placed in her and described her actions as a calculated effort to steal money from the victims. Judge Gleason also noted that Yangson’s embezzlement from a relatively small business had seriously affected the company’s financial well-being during the period of time that she was stealing money.
“IRS Criminal Investigation is committed to investigating individuals who use their employers as personal piggy banks," said Darrell Waldon, Special Agent in Charge, Seattle Field Office. “Ms. Yangson spent years enriching herself and her husband by stealing from her employer and from honest Americans who pay their tax obligations. The IRS and the U.S. Attorney’s Office will continue to vigorously pursue criminals like Ms. Yangson and hold them accountable for their actions.”
IRS Criminal Investigation, the FBI, and APD conducted the investigation leading to the successful prosecution of this case.
Former Bank of Oswego Executive Receives Federal Prison Sentence for FraudRead the Press Release
PORTLAND, Ore. – On Wednesday, January 24, 2018, U.S. District Court Judge Michael H. Simon sentenced Geoffrey S. Walsh, a former vice president of the Bank of Oswego, to 30 months in federal prison followed by a three-year term of supervised release. Walsh had previously pleaded guilty to one count each of conspiracy to make false entries in bank records, conspiracy to commit mail and wire fraud, and wire fraud on July 22, 2015.
“Geoff Walsh intentionally and repeatedly perpetrated large financial crimes that cheated individual investors and deceived bank regulators and the Bank of Oswego’s Board of Directors,” said Billy J. Williams, U.S. Attorney for the District of Oregon. “He achieved this largely while retaining a position of trust as a bank executive. The imposition of this sentence demonstrates that stealing from investors and lying to regulators about a bank’s financial condition are grave matters and subject to felony charges and a prison sentence. Today’s sentencing is many years’ in the making and a testament to the hard work and persistence of federal law enforcement.”
"Today's sentencing helps to shed light on the sophisticated world of complex financial fraud at a bank where certain executives were more committed to their personal interests than those of their customers," said Steve Goldman, Assistant Special Agent in Charge of the FBI in Oregon. "Geoff Walsh's deal-making during these long-running schemes damaged the bank itself and hurt the friends and clients who had entrusted him with their money."
Facts Related to Conspiracy to Make False Entries in Bank Records Conviction
From January 2009 to May 2012, Walsh served as the Bank of Oswego’s Vice President and Director of Mortgage Services and later as its Vice President of Business Development and Lending Services. As an institution insured and regulated by the Federal Deposit Insurance Corporation (FDIC), the bank was required to submit quarterly call reports detailing the financial condition of the bank.
From 2009 through 2010, the bank was in second position on a mortgage secured by real property located on A Avenue in Lake Oswego, Oregon. The borrower’s failure to make timely payments and her deteriorating financial condition were discussed weekly by Walsh and other members of the bank’s Internal Loan Committee (ILC), including the CEO, Dan Heine and CFO, Diana Yates. In October 2010, the first mortgagee declared the borrower in default and foreclosed on the property. In order to avoid a loss of nearly $100,000 and avoid reporting the loss to the FDIC and the board of directors, Walsh, Heine and Yates formulated a plan to acquire and sell the property to recover the remaining balance on the loan. Walsh was put in charge of obtaining the property for the bank.
Walsh initially attempted to purchase the property directly from Fannie Mae, but was told it could only be sold to an individual who planned to occupy the property, and could not be sold to an institution until the property had been on the market for 15 days. On behalf of the bank, Walsh arranged for another bank employee to serve as a straw buyer, purchasing the property in the employee’s name. To accomplish this, Walsh, Heine and Yates agreed to and submitted false information to Fannie Mae about the true buyer, the source of the funds to purchase the property and the buyer’s intent to remain in the home as an occupant. Records of the sale were purposefully not maintained by Walsh, Heine and Yates in order to conceal the transaction from the bank’s board of directors and the FDIC.
On November 28, 2017, a federal jury found Heine and Yates guilty of a conspiracy to deceive the bank’s board of directors, shareholders and regulators as well as 12 counts of making false entries in the bank’s records to the FDIC and the board of directors. The verdict was based, in part, on the A Avenue transaction. Heine and Yates will be sentenced on March 5, 2018.
Facts Related to Conspiracy to Commit Mail and Wire Fraud Conviction
According to court documents, Walsh worked with his brother Gregory Walsh, a former Vice President at Morgan Stanley, to persuade an Arizona woman into loaning him more than $764,000 for a real estate investment scheme. The woman, a recent widow and client of Greg Walsh’s, was told the money would be used to purchase two condominiums in the Palm Springs, California area that would be titled in her name and sold within one year.
Contrary to the promises made, Walsh titled each of the properties in the name of his business and never provided any loan or title documentation to his investor. Between May and July 2012, he sold the properties without the knowledge or permission of his investor and used the proceeds to satisfy personal financial obligations.
In January 2013, Walsh contacted his brother to gauge the same investor’s interest in loaning him an additional $2 million for a real estate development project in Oregon. Greg Walsh transferred the money from the investor’s Morgan Stanley account to his brother without the investor’s knowledge or approval. On March 5, 2013, the majority of these funds – over $1.7 million – were used to pay the balance of a line of credit at the bank. Walsh spent the remainder of the funds.
Greg Walsh has also pleaded guilty to conspiracy to commit wire fraud for these same transactions. His will be sentenced on February 6, 2018.
Facts Related to Wire Fraud Conviction
In May 2012, Walsh secured a commercial loan for $500,000 from an Oregon resident, using the first two Palm Springs properties as collateral. In securing the loan, he failed to disclose that the properties were already pledged as security for loans he had obtained from the Arizona investor and that he was already in negotiations to sell one of the properties. Soon after receiving the loan, Walsh sold both properties and used the proceeds for his own benefit.
Between November 2012 and July 2013, the Oregon resident was repeatedly in contact with Walsh in an attempt to obtain repayment. Walsh assured his lender that he would repay the loan in full with interest. In May 2013, the lender met with the FBI to discuss Walsh’s default on the loan. Walsh made a partial repayment of $300,000 after the lender met with the FBI.
This case was investigated by the FBI and the FDIC Office of Inspector General (OIG-FDIC) and prosecuted by Claire M. Fay, Michelle Holman Kerin, and Quinn P. Harrington, Assistant U.S. Attorneys for the District of Oregon.
Fayetteville Man Sentenced for Felon in Possession and Possession of a Firearm in Furtherance of a Drug Trafficking CrimeRead the Press Release
RALEIGH – The United States Attorney for the Eastern District of North Carolina, Robert J. Higdon, Jr., announced that today in federal court, Chief United States District Judge James C. Dever, III sentenced RAYMOND DEMONT NEAL, 38, of Fayetteville to 78 months of imprisonment followed by 5 years of supervised release.
NEAL was named in a three-count Indictment filed on March 7, 2017. On September 11, 2017, NEAL subsequently pled guilty to one-count of Felon in Possession of a Firearm and Ammunition and one-count of Possession of a Firearm in Furtherance of a Drug-Trafficking Crime.
On October 16, 2016, an officer from the Fayetteville Police Department (FPD), observed a vehicle fail to stop for a stop sign. The officer attempted to initiate a traffic stop; however, the driver, NEAL, did not immediately stop, instead pulling into the driveway of his home and exiting the vehicle. The officer ordered NEAL to stop, but the defendant continued to walk towards the door of the residence. NEAL attempted to unlock the door and officers tried to place NEAL into custody, but he was uncooperative. It took several officers to handcuff NEAL, who refused to place his hands behind his back or get into the patrol vehicle. Officers suspected NEAL was intoxicated due to his blood shot eyes and the strong odor of alcohol on his breath. Officers stayed on scene until a search warrant for NEAL’s vehicle was granted and served. A search of the vehicle revealed a .45 caliber pistol loaded with 6 rounds of ammunition, 40.26 grams of Dibutylone, 13.48 grams of marijuana, a digital scale, a pocket knife, baggies, and a box cutter.
NEAL, a convicted felon, illegally possessed a firearm and ammunition during and in relationship to a drug-trafficking crime. NEAL also possessed a firearm during and in relationship to a shooting incident on January 22, 2016.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.
The Fayetteville Police Department and the Bureau of Alcohol Tobacco Firearms and Explosives (ATF) conducted the criminal investigation of this case. Assistant United States Attorney S. Katherine Burnette handled the prosecution of this case for the government.
Fayette County woman pleads guilty for role in federal drug conspiracyRead the Press Release
BECKLEY, W.Va. – A Fayette County woman pleaded guilty today for her role in a drug trafficking conspiracy, announced United States Attorney Mike Stuart. Tiffany D. Ramsey, 27, of Boomer, entered her guilty plea to conspiracy to distribute and possess with intent to distribute more than 50 grams of methamphetamine, a quantity of heroin, and a quantity of oxycodone. Ramsey is one of 23 defendants indicted in June 2017 after a comprehensive investigation of drug trafficking in Southern West Virginia.
U.S. Attorney Stuart commended the cooperative investigative efforts of several agencies. The investigation was led by the Federal Bureau of Investigation and the Raleigh County Drug and Violent Crime Task Force. The Drug Enforcement Administration, the Beckley Police Department, the Raleigh County Sheriff’s Department, the West Virginia State Police, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the United States Postal Inspection Service provided assistance throughout the investigation.
Ramsey admitted that between May 2017 and June 28, 2017, she took part in a drug trafficking conspiracy with multiple participants. During this time period, Ramsey admitted to working with Cheyenne Fragale and others to distribute methamphetamine, heroin, and oxycodone in and around Fayette County. Ramsey admitted that she and Cheyenne Fragale sold the controlled substances from their house near Boomer. Ramsey also admitted that on June 28, 2017, law enforcement officers executed search warrants at various locations related to this drug trafficking conspiracy. During the searches, officers seized over 300 grams of crystal methamphetamine, as well as heroin, fentanyl, and over $29,000 in cash. The methamphetamine was later analyzed and confirmed to be 94% pure.
Ramsey faces at least five and up to 40 years federal prison when she is sentenced on May 2, 2018.
Other individuals implicated as a result of this drug investigation have entered guilty pleas and are awaiting sentencing. Cheyenne Fragale and Macon Fragale, two brothers from Boomer in Fayette County, previously pleaded guilty to conspiracy to distribute and to possess with intent to distribute more than 500 grams of methamphetamine, a quantity of oxycodone, and a quantity of heroin. They both face a mandatory minimum of 10 years and up to life in federal prison when they are sentenced on March 14, 2018. Donald Scalise, of Montgomery, previously entered a guilty plea to conspiracy to distribute a quantity of oxycodone. Scalise faces up to 20 years in federal prison when he is sentenced on April 25, 2018. Dominic Copney, of Beckley, previously entered a guilty plea to conspiracy to distribute and possess with the intent to distribute more than 500 grams of cocaine and more than 100 grams of heroin. He faces a mandatory minimum of five and up to 40 years in federal prison when he is sentenced on April 17, 2018. Detria Carter, of Beckley, previously pleaded guilty to possession with intent to distribute more than 500 grams of cocaine. She faces a mandatory minimum sentence of not less than five and up to 40 years in federal prision when she is sentenced on April 24, 2018. Velarian Carter, the brother of Detria Carter, previously entered a guilty plea to conspiracy to distribute and possess with intent to distribute more than five kilograms of cocaine, more than 280 grams of crack, and more than 100 grams of heroin. He faces a mandatory minimum of not less than 20 years and up to life in federal prison when he is sentenced on April 17, 2018.
Assistant United States Attorney Timothy D. Boggess is in charge of these prosecutions. The Ramsey plea hearing was held before United States District Judge Irene C. Berger.
These cases are being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of illegal drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down pill trafficking, eliminating open air drug markets, and curtailing the spread of illegal drugs in communities across the Southern District.
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Detroit-Area Podiatrist Pleads Guilty to Health Care FraudRead the Press Release
A Detroit-area podiatrist pleaded guilty today to health care fraud for his participation in a $1 million scheme involving podiatry services that were never rendered.
Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Matthew Schneider of the Eastern District of Michigan, Special Agent in Charge David P. Gelios of the FBI’s Detroit Division and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Chicago Regional Office made the announcement.
Lawrence Young, D.P.M., 70, of Bloomfield Hills, Michigan, pleaded guilty to one count of health care fraud before U.S. District Judge Judith E. Levy of the Eastern District of Michigan. Sentencing has been scheduled for May 22 before Judge Levy.
As part of his guilty plea, Young admitted that from approximately January 2010 through April 2017, he engaged in a scheme to defraud the Medicare program by causing the submission of false and fraudulent claims to Medicare for the application of an “Unna Boot,” which is a type of medicated dressing typically applied after surgery to control swelling of the leg or foot. Young admitted regularly submitting these claims for reimbursement even though he knew that his patients routinely received nothing more than a non-medicated dressing. The scheme involved the submission of more $1 million in fraudulent claims to Medicare, he admitted.
This case was investigated by the FBI and HHS-OIG. Trial Attorneys Tom Tynan and Steve Scott of the Criminal Division’s Fraud Section are prosecuting the case.
The Fraud Section leads the Medicare Fraud Strike Force, which is part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3,500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
Coral Gables Resident Charged with Wire Fraud in Connection with Hurricane Relief Efforts for Puerto RicoRead the Press Release
Emilio I. Vazquez, of Coral Gables, was arrested on a criminal complaint charging him with wire fraud in connection with hurricane relief efforts to Puerto Rico.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Brian Swain, Special Agent in Charge, United States Secret Service (USSS), made the announcement.
According to the allegations contained in the criminal complaint, in or around September 2017, Vazquez contacted a group of volunteers working to provide hurricane relief aid to Puerto Rico. Vazquez claimed that he was part of the Serralles family, who are the owners of Destileria Serralles, which distills, manufactures, bottles and distributes Don Q rum in Puerto Rico. Vazquez claimed to have significant resources and the ability to rent warehouses, and charter planes and trucks to transport relief supplies.
According to the complaint, in or around September 2017, Vazquez, using the name Emilio Serralles, contacted Commercial Property Group in Doral, Florida, regarding the rental of warehouse space. The warehouse space was purportedly to be used to store relief supplies for Puerto Rico. On or about September 29, 2017, Vazquez provided Commercial Property Group with a counterfeit and fraudulent UBS bank cashier’s check in the amount of $122,050.50, to pay for the warehouse space. It is alleged that the next day, Vazquez signed a lease under the name Emilio Serralles, renting five warehouse spaces from Commercial Property Group.
According to the complaint, in or around October 2017, Vazquez contacted Miami Air International, a local charter airline. Vazquez again identified himself as Emilio Serralles and claimed to own a company called Puerto Rico Relief Committee. Subsequently, Vazquez chartered multiple flights from Miami to Puerto Rico to purportedly deliver relief supplies. As payment for these flights, Vazquez provided a counterfeit and fraudulent American Express Centurion Bank cashier’s check in the amount of $564,036.05 to Miami Air International, which was rejected as fraudulent by U.S. Trust, Bank of America Private wealth management.
On January 23, 2017, a New York City Police Department officer arrested Vazquez in Brooklyn, New York. He is scheduled to make his initial appearance on Thursday, January 25, 2018, at 2 p.m., before U.S. Magistrate Judge Viktor V. Pohorelsky, of the Eastern District of New York, in Brooklyn, New York.
Mr. Greenberg commended the investigative efforts of the USSS. This case is being prosecuted by Assistant United States Attorney Joshua S. Rothstein.
A criminal complaint is merely an allegation and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt 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 atwww.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Citizen of Mexico Sentenced to Time Served for Entering the United States after RemovalRead the Press Release
Bangor, Maine: United States Attorney Halsey B. Frank announced that Eliud Lopez-Baez, 32, a citizen of Mexico, was sentenced today in U.S. District Court by Judge John A. Woodcock, Jr., to time served (about two months) in prison for illegally entering and being found in the United States after having been removed. The defendant pleaded guilty to the crime on December 11, 2017.
Court documents reveal that on November 28, 2017, at about 7:50 a.m., U.S. Border Patrol agents found the defendant in a swamp in Hodgdon, Maine, a short distance from the international boundary. The defendant had no immigration documents and admitted that he was a citizen of Mexico. Immigration records showed that he had been removed from the United States in February 2017.
The case was investigated by the U.S. Border Patrol.
Citizen of Ecuador Charged with Harboring Illegal AliensRead 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 Segundo Francisco Caguana, a citizen of Ecuador, was arrested and charged by criminal complaint with harboring aliens, encouraging illegal aliens to reside in the United States, and hiring or recruiting unauthorized aliens for employment. The charges carry a maximum penalty of 10 years in prison and a $250,000 fine.
Assistant U.S. Attorney Kyle P. Rossi, who is handling the case, stated that according to the complaint, on October 5, 2017, Immigration and Customs Enforcement, Homeland Security Investigations (ICE-HSI), received information from the Caledonia Police Department regarding possible illegal aliens residing at 246 North Street in Caledonia, NY, and working for Sunset Roofing Corp. Surveillance operations were conducted between October 30 and November 9, 2017. Special agents observed Caguana arrive at the residence in a brown Toyota Tundra at approximately 6:30 a.m. each morning and enter the residence, before departing approximately a half hour later. Thereafter, multiple Hispanic adult males would depart the residence in two work vans parked in the driveway.
On November 14, 2017, ICE-HSI agents and ICE Enforcement Removal Officers (ERO) conducted a joint enforcement operation in an attempt to encounter illegal aliens residing at the 246 North Street residence. ICE-HSI agents and ERO officers identified themselves and conducted interviews with the individuals. Seven of the individuals admitted to being illegally present and illegally working within the United States. Six of the undocumented aliens were arrested for entry without inspection, and one was arrested for visa waiver overstay. All seven were transported to the Batavia Detention Facility for processing.
The complaint states that all seven of the illegal aliens worked for Caguana and paid him rent to stay at the 246 North Street residence.
A records check found that Caguana and his wife are citizens and nationals of Ecuador, currently involved in immigration proceedings, but authorized to work within the United States.
The defendant made an initial appearance before U.S. Magistrate Judge Jonathan W. Feldman and was released on conditions.
The complaint is the result of an investigation by Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent-in-Charge Kevin Kelly, and Immigration and Customs Enforcement, Enforcement and Removal Operations, under the direction of Field Office Director Thomas E. Feeley.
The fact that a defendant has been charged with a crime is merely an accusation, and the defendants are presumed innocent until and unless proven guilty.
Chinese National Pleads Guilty to Fraud ChargesRead the Press Release
BOSTON – A Chinese national pleaded guilty yesterday in federal court in Boston to misuse of a passport and visa fraud.
Yinyan Wang, 25, a Chinese national studying in Pennsylvania, pleaded guilty to one count of misuse of a passport and one count of passport fraud. U.S. District Court Judge Indira Talwani scheduled sentencing for April 25, 2018. In November 2017, Wang was arrested in Pennsylvania.
On Oct. 20, 2017, Wang took the Graduate Record Exam (GRE) in Boston for another Chinese citizen. At the testing site, Wang presented a counterfeit Chinese passport containing a counterfeit nonimmigrant visa purportedly issued by the United States in the identity of the other student. On five prior occasions between July 2017 and August 2017, Wang took either the GRE or the Test of English as a Foreign Language (TOEFL) exam under assumed names for other people.
Each charge provides for a sentence of no greater than 10 years in prison, three years of supervised release, and a fine of $250,000. Wang will be subject to deportation upon completion of her sentence. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Michael Shea, Acting Special Agent in Charge of Homeland Security Investigations in Boston; and William B. Gannon, Special Agent in Charge of the Boston Field Office of the U.S. Department of State's Diplomatic Security Service made the announcement today. Assistant U.S. Attorney David G. Tobin of Lelling’s Major Crimes Unit is prosecuting the case.
Chinese Company Sinovel Wind Group Convicted of Theft of Trade SecretsRead the Press Release
A manufacturer and exporter of wind turbines based in the People’s Republic of China was convicted today of stealing trade secrets from AMSC, a U.S.-based company formerly known as American Superconductor Inc., announced Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division and U.S. Attorney Scott C. Blader for the Western District of Wisconsin.
Following an 11-day trial, a jury sitting in Madison, Wisconsin, convicted Sinovel Wind Group Co. Ltd., dba Sinovel Wind Group (USA) Co. Ltd. (Sinovel) of conspiracy to commit trade secret theft, theft of trade secrets, and wire fraud. Sentencing is set for June 4.
“Sinovel nearly destroyed an American company by stealing its intellectual property,” said Acting Assistant Attorney General Cronan. “As today’s jury verdict demonstrates, this type of conduct, by any corporation – anywhere – is a crime, and won’t be tolerated. The Department is dedicated to helping foster innovation and growth in our economy by deterring and punishing intellectual property theft from American companies.”
“Today’s verdict sends a strong and clear message that the theft of ideas and ingenuity is not a business dispute; it’s a crime and will be prosecuted as such,” said U.S. Attorney Blader. “Sinovel’s illegal actions caused devastating harm to AMSC. I commend the efforts of the investigation and prosecution team, and reaffirm the commitment of this office to protect American commerce and prosecute those who would seek to steal intellectual property.”
As proven at trial, Sinovel stole proprietary wind turbine technology from AMSC in order to produce its own turbines powered by the stolen intellectual property. AMSC developed the technology – software that regulates the flow of electricity from wind turbines to electrical grids – in Wisconsin and elsewhere. At the time of the theft in March 2011, Sinovel had contracted with AMSC for more than $800 million in products and services to be used for the wind turbines that Sinovel manufactured, sold, and serviced.
Sinovel was charged on June 27, 2013, along with Su Liying, the deputy director of Sinovel’s Research and Development Department; Zhao Haichun, a technology manager for Sinovel; and Dejan Karabasevic, a former employee of AMSC Windtec Gmbh, a wholly-owned subsidiary of AMSC. The evidence presented at trial showed that Sinovel conspired with the other defendants to obtain AMSC’s copyrighted information and trade secrets in order to produce wind turbines and to retrofit existing wind turbines with AMSC technology without paying AMSC the more than $800 million it was owed and promised. Through Su and Zhao, Sinovel convinced Karabasevic, who was head of AMSC Windtec’s automation engineering department in Klagenfurt, Austria, to leave AMSC Windtec, to join Sinovel, and to steal intellectual property from the AMSC computer system by secretly downloading source code on March 7, 2011, from an AMSC computer in Wisconsin to a computer in Klagenfurt. Sinovel then commissioned several wind turbines in Massachusetts and copied into the turbines software compiled from the source code stolen from AMSC. The U.S.-based builders of these Massachusetts turbines helped bring Sinovel to justice. Su and Zhao are Chinese nationals living in China, and Karabasevic is a Serbian national who lived in Austria, but now lives in Serbia.
According to evidence presented at trial, following the theft, AMSC suffered severe financial hardship. It lost more than $1 billion in shareholder equity and almost 700 jobs, over half its global workforce.
The case was investigated by the FBI’s Madison, Milwaukee, and Boston Offices; the FBI Legal Attachés’ Offices in Vienna, Austria and Beijing; the FBI Criminal Investigative Division; the FBI Intellectual Property Rights program; the Bundeskriminalamt (Federal Criminal Intelligence Service) and the Bundesministerium Fuer Justiz (Federal Ministry of Justice) in Austria; the Landeskriminalamt - Klagenfurt and the Staatsanwaltschaft - Klagenfurt (Criminal Investigative Police and State Prosecutor’s Office – Klagenfurt, Austria); and with the assistance of the Justice Department’s Office of International Affairs and the Cybercrime Laboratory of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS).
Senior Counsel Brian L. Levine of CCIPS and Assistant U.S. Attorneys Timothy M. O’Shea and Darren Halverson for the Western District of Wisconsin prosecuted the case, with substantial assistance from CCIPS Trial Attorney Joss Nichols and Digital Investigative Analyst Laura Peterson.
The Department of Justice’s Task Force on Intellectual Property (IP Task Force) contributed to this case. The IP Task Force is led by the Deputy Attorney General to combat the growing number of domestic and intellectual property crimes, to protect the health and safety of American consumers, and to safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation, and hard work. To learn more about the IP Task Force, go to https://www.justice.gov/iptf.
Chicago Futures Trader Pleads Guilty to Causing More Than $13 Million in Losses from Fraudulent Trading SchemeRead the Press Release
CHICAGO — A Chicago futures trader admitted in federal court that he caused more than $13 million in losses through a fraudulent trading scheme that resulted in the collapse of his firm.
THOMAS LINDSTROM used deep out-of-the-money options on ten-year Treasury Note futures to make it fraudulently appear that his trading at Chicago-based Rock Capital Markets LLC was profitable, thereby obtaining greater financial compensation for himself. Over a six-month period in 2014 and 2015, Lindstrom obtained compensation of $285,000, while his fraud scheme caused a loss of more than $13.7 million and led to the collapse of Rock Capital.
Lindstrom, 55, of Winnetka, pleaded guilty Tuesday to one count of wire fraud. U.S. District Judge Harry D. Leinenweber set sentencing for June 19, 2018. Lindstrom acknowledged in the plea agreement that at the time of sentencing, the Court will order him to make full restitution in the amount of $13,776,518.
The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation. The government is represented by Assistant U.S. Attorney Sunil Harjani and Special Assistant U.S. Attorney Lindsey Evans of the Securities and Commodities Fraud Section of the U.S. Attorney’s Office in Chicago. The Commodity Futures Trading Commission, which filed a civil enforcement lawsuit against Lindstrom, provided assistance.
A tick is the minimum price increment at which an option on a futures contract could trade. Prior to 2016, the Chicago Board of Trade set the minimum settlement value of all options on futures contracts at one tick, even if the actual value of the option was considerably less. For options on ten-year Treasury Note futures contracts, one tick was approximately $15.63.
Lindstrom admitted in a plea agreement that he acquired hundreds of thousands of deep out-of-the-money options on ten-year Treasury Note futures, and on certain occasions he used spread transactions to pay effectively less than one tick apiece. Lindstrom made the trades knowing that these options would likely expire worthless – resulting in losses – but would temporarily appear to have substantial value in his trading account because the minimum settlement value was one tick.
Lindstrom concealed the scheme by telling Rock Capital’s owner that the options were profitable, when in reality Lindstrom’s trading was causing substantial losses.
Wire fraud is punishable by a maximum sentence of 20 years in prison. The Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
Buffalo Man Sentenced for Selling Drugs Near A Buffalo SchoolRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y.-U.S. Attorney James P. Kennedy, Jr. announced today that Thomas Cox, 50, of Buffalo, NY, who was convicted of possession with intent to distribute, and distribution of, cocaine within 1,000 feet of a school or playground, was sentenced to 24 months in prison by Senior U.S. District Judge William M. Skretny.Assistant U.S. Attorney Patricia Astorga, who handled the case, stated that in February 2017, law enforcement officers began an investigation into the cocaine, crack cocaine, and marijuana distribution activities of the defendant out of a residence at 45 A Street in Buffalo.
On March 3, 2017, officers conducted surveillance of the residence at 45 A Street and witnessed the defendant discussing the sale of cocaine with an individual. Cox was then observed getting into vehicle and driving a short distance to a residence at 325 Mills Street. After a few minutes inside, the defendant left the Mills Street residence and returned to the A Street residence. Cox was then observed selling a plastic sandwich bag containing a quantity of cocaine.
A few days later, on March 8, 2017, officers once again surveilled the A Street address and noticed traffic coming and going from the residence. Cox was observed exiting the front door of the residence and traveling once again to 325 Mills Street. Once again, the defendant eventually returned to the A Street residence and provided cocaine to another individual.
On March 10, 2017, officers executed a search warrant at 325 Mills Street and discovered a small safe in the attic area which contained $24,000 in cash, and a blue canvas bag containing two plastic baggies of suspected crack cocaine, a digital scale with drug residue, and numerous empty plastic sandwich bags. A search of 45 A Street revealed a large quantity of small Ziploc bags commonly used for packaging crack cocaine. A DVR video recording system which recorded the interior and exterior of 45 A Street was also seized. The defendant was found in 45 A Street and arrested.
The residences at 325 Mills Street and 45 A Street are located within about 230 feet and 72 feet of Buffalo Public School 59, The Science Magnet School located at 50 A Street.
The sentencing is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge James J. Hunt, New York Field Division; the Buffalo Police Department, under the direction of Acting Commissioner Byron Lockwood; Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent-in-Charge Kevin Kelly; the Erie County Sheriff’s Office, under the direction of Sheriff Timothy Howard; Customs and Border Protection, under the direction of Director of Field Operations Rose Brophy; and the Cheektowaga Police Department, under the direction of Chief David Zack.