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21 February 2018
Two more defendants plead guilty for roles in federal drug conspiracyRead the Press Release
BLUEFIELD, W.Va. – Two men pled guilty today for their roles in a drug trafficking conspiracy, announced United States Attorney Mike Stuart. Shawn Akiem Anderson, 44, of Mt. Hope, entered his guilty plea to conspiracy to distribute and possess with intent to distribute less than 50 kilograms of marijuana. Karl Funderburk, 31, of Teays Valley, entered his guilty plea to using and carrying a firearm during a drug trafficking crime. Anderson and Funderburk are two 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, 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 also provided assistance throughout the investigation.
“This case shows how united and determined we are in fighting the drug scourge,” said U.S. Attorney Stuart. “With 23 defendants charged, the results speak for themselves. Drug dealers had better take notice that all levels of law enforcement – federal, state, and local – are working together to make sure that drug crime results in hard time.”
Shawn Anderson admitted that between May 2017 and June 28, 2017, he took part in a drug trafficking conspiracy with multiple participants involving the distribution of cocaine, heroin, and marijuana. Anderson admitted to working with Detria Carter and others to distribute marijuana in and around Raleigh County. Anderson also admitted that he distributed or possessed with the intent to distribute approximately 44 kilograms of marijuana during this time frame.
Karl Funderburk admitted that between August 2016 and March 1, 2017, he assisted Velarian Carter, Detria Carter, and others, in operating a drug trafficking organization. Funderburk also admitted that on March 1, 2017, he was arrested in Charleston, and during a subsequent search, police discovered that he possessed cocaine, crack, and methamphetamine. Funderburk also possessed a Glock 27, .40 caliber, semi-automatic pistol, that he admitted was used for protection of his drugs and drug proceeds.
Anderson faces up to 10 years in federal prison when he is sentenced on May 29, 2018. Funderburk faces at least five years and up to life in federal prison when he is sentenced on May 29, 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 pled 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. Tiffany Ramsey, also of Boomer, previously entered a guilty plea to conspiracy to distribute or possess with intent to distribute more than 50 grams of methamphetamine, a quantity of heroin, and a quantity of oxycodone. Ramsey faces at least five years and up to 40 years in federal prison when she is sentenced on May 2, 2018. Donald Scalise, of Montgomery, previously entered a guilty plea to conspiracy to distribute 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 pled 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 Anderson and Funderburk plea hearings were held before Senior United States District Judge David A. Faber.
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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Two Nixa Residents Plead Guilty, Florida Man Indicted in Scheme to Market Dietary SupplementsRead the Press Release
SPRINGFIELD, Mo. – Timothy A. Garrison, United States Attorney for the Western District of Missouri, announced today that two Nixa, Mo., residents have pleaded guilty and a Florida resident has been indicted in a scheme to market an all-natural male enhancement supplement that actually contained the same active ingredient found in Viagra.
John G. Schindele, 41, and Jennifer S. Travis, 45, both of Nixa, waived their right to a grand jury and pleaded guilty in separate appearances before U.S. Magistrate Judge David P. Rush on Tuesday, Feb. 20, 2018.
Michael S. Schindele, 43, of Jacksonville, Florida, was charged in a two-count indictment returned under seal by a federal grand jury in Springfield, Mo., on Tuesday, Feb. 20, 2018. That indictment was unsealed and made public today upon Schindele’s arrest and initial court appearance.
Michael Schindele, the owner and operator of Executive Image International, operated a website that sold dietary supplements and drugs to the general public. The federal indictment alleges that he worked through businesses owned and operated by John Schindele (his brother) and Travis to sell dietary supplements, which claimed to contain only all-natural ingredients.
Michael Schindele marketed Silver Bullet as an “all-natural male performance enhancer,” an “Extreme Male Stimulant,” and a “dietary supplement.” In reality, the indictment says, Silver Bullet contained materially different ingredients than what was listed, including sildenafil, a synthetic pharmaceutical ingredient that was not disclosed to consumers purchasing the product.
Sildenafil is the active pharmaceutical that is commonly used in the erectile dysfunction drug Viagra. The labeling for Silver Bullet failed to provide adequate warnings about the use of a sildenafil-containing product, which is only legally available with a prescription from a doctor.
According to the indictment, Silver Bullet was purchased and shipped from a supplier in the People’s Republic of China, then resold by Michael Schindele and others to consumers throughout the United States.
The indictment charges Michael Schindele with one count of wire fraud and one count of delivering adulterated or misbranded food. It also contains a forfeiture allegation, which would require Michael Schindele to forfeit to the government all property derived from the proceeds of the offense, including a money judgment of $47,930.
John Schindele, who pleaded guilty to one count of mail fraud and one count of delivering adulterated or misbranded food, is the owner of Schindele Enterprises, L.L.C., and Midwest Wholesale. Travis, who also pleaded guilty to one count of mail fraud and one count of delivering adulterated or misbranded food, partially owned and managed a business known as Kinevative. Both businesses sold food and drug products advertised as “dietary supplements” to customers throughout the United States and worldwide. The base of operation for both of these businesses was in Nixa.
By pleading guilty, John Schindele admitted that he marketed Silver Bullet as an “all-natural male performance enhancer,” and a “dietary supplement” and failed to disclose that sildenafil was an ingredient. John Schindele was not authorized or licensed to sell this pharmaceutical.
According to his plea agreement, John Schindele fraudulently received $210,000 for the misrepresented and mislabeled dietary supplements from April 16, 2012, to July 8, 2015.
Travis marketed products known as Boost Ultra and Magic for Men as an “Ultra Sexual Enhancement Formula.” The products were advertised as dietary supplements, and the label listed the contents as “all natural.” Travis admitted that she failed to disclose that Boost Ultra and Magic for Men also contained sildenafil. Travis was not authorized or licensed to sell sildenafil.
Federal agents, acting in an undercover capacity, purchased products, including Boost Ultra and Magic for Men, that were advertised as containing all-natural ingredients. The supplements were purchased from websites that were traced back to Travis. The purchased dietary supplements were then tested by the FDA and found to contain undeclared active pharmaceutical ingredients, including sildenafil.
According to her plea agreement, Travis fraudulently received $152,862 for the misrepresented and mislabeled dietary supplements from June 2, 2014, through Jan. 31, 2017.
Under federal statutes, John Schindele and Travis are each subject to a sentence of up to 21 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendants will be determined by the court based on the advisory sentencing guidelines and other statutory factors. Sentencing hearings will be scheduled after the completion of presentence investigations by the United States Probation Office.
Garrison cautioned that the charges contained in the 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.
These cases are being prosecuted by Assistant U.S. Attorneys Patrick Carney and Nhan D. Nguyen. They were investigated by the U.S. Food and Drug Administration.
Two Men Sentenced to Prison for Roles in Trenton Cocaine Distribution ConspiracyRead the Press Release
TRENTON, N.J. – Two Trenton men were both sentenced to over seven years in prison today for conspiring to distribute over a kilogram of cocaine and 100 grams of crack cocaine in the Trenton area, U.S. Attorney Craig Carpenito announced.
Khalfini Richardson, 33, and Capitol T. Wellons, 32, were sentenced today to 156 and 84 months in prison, respectively. Both defendants previously pleaded guilty before U.S. District Judge Michael A. Shipp to Count One of an indictment charging them with conspiracy to distribute and possess 500 grams or more of cocaine and to manufacture, distribute, and possess 28 grams or more of cocaine base. Judge Shipp imposed the sentences today in Trenton federal court.
According to the documents filed in this case and statements made in court, from September 2013 through Jan. 13, 2016, Richardson and Wellons conspired with co-defendants Bobby Williams and William Enmond to distribute cocaine and manufacture crack cocaine from two adjacent residences in Trenton. Richardson and Wellons both admitted that they conspired to distribute and possess 1.72 kilograms of cocaine and 122.6 grams of cocaine base.
In addition to the prison term, Judge Shipp sentenced both Richardson and Wellons to five years of supervised release.
Enmond and Williams have also pleaded guilty. Williams awaits sentencing. Enmond was sentenced July 20, 2017 to 60 months in prison.
U.S. Attorney Carpenito credited special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Valerie Nickerson in Newark, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Molly Lorber and Senior Litigation Counsel Joseph Gribko of the U.S. Attorney’s Office Criminal Division in Trenton.
18-072
Defense counsel: Richardson: Brynn Giannullo Esq., New Brunswick, New Jersey
Wellons: Lawrence George Welle Esq., Wall, New Jersey
Turtle Creek Man Indicted for Illegally Possessing a Pistol and AmmunitionRead the Press Release
PITTSBURGH – An Allegheny County resident has been indicted by a federal grand jury in Pittsburgh on a charge of violating the federal firearms laws, United States Attorney Scott W. Brady announced today.
The one-count indictment, returned on Feb. 20, named Iklas Richard Davis, 36, of Turtle Creek, Pennsylvania.
According to the indictment, on or about October 13, 2017, Davis, an individual with a prior felony conviction for theft by unlawful taking or disposition, did knowingly and unlawfully possess a Ruger .45 caliber American Pistol and ammunition. Federal law prohibits anyone who has been convicted of a crime punishable by a term of imprisonment exceeding one year from possessing a firearm or ammunition.
For Davis’s offense, the law provides for a maximum total sentence of not more than 10 years in prison, a fine of not more than $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history of the defendant.
Assistant United States Attorney Brendan T. Conway is prosecuting this case on behalf of the government.
The United States Secret Service and the Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation leading to the indictment in this case. 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.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Three Florida Residents Plead Guilty to ATM FraudRead the Press Release
Gulfport, Miss. – Claudio Fontes Ferreira, 30, of Deerfield Beach, Florida, Rodrigo D. Ferrareze, 37, of Delray Beach, Florida, and Taise Braganca Moscon, 26, of Pompano, Florida, each pled guilty yesterday before U.S. District Judge Sul Ozerden to access device fraud, announced U.S. Attorney Mike Hurst and Thomas M. Annello, Acting Special Agent in Charge of U.S. Immigration and Customs Enforcement's Homeland Security Investigations in New Orleans.
On December 7, 2017, the defendants were stopped in a Lincoln Navigator with Florida tags after being at a Keesler Federal Credit Union Automated Teller Machine ("ATM") on Automall Parkway in D’Iberville, Mississippi. The ATM was found to have a skimmer on it and had been altered with the top flap privacy shield being cut off so a camera placed above could observe the ATM key pad where customers enter their account PIN numbers. A search of the Lincoln Navigator resulted in the finding of access device equipment, to include but not limited to, glue, black electrical and double-sided tape and box cutters, credit cards in alias names, a card with sand paper attached to the card, and other credit cards, gift cards, and a micro SD card.
The defendants will be sentenced by Judge Ozerden on Wednesday, June 6, 2018, at 9:30 a.m. They each face a maximum sentence of 15 years in prison and a $250,000 fine.
This case was investigated by Homeland Security Investigations and prosecuted by Assistant U.S. Attorney Andrea Jones.
Texas Man Sentenced for Transporting Aliens in Truck’s Tool BoxRead the Press Release
BROWNSVILLE, Texas – A 34-year-old resident of San Antonio has been ordered to federal prison for illegally transporting undocumented aliens, announced U.S. Attorney Ryan K. Patrick. Richard Sanchez pleaded guilty Nov. 7, 2017.
Today, U.S. District Judge Rolando Olvera sentenced Sanchez to 21 months imprisonment to be immediately followed by a year of supervised release.
On Oct. 10, 2017, law enforcement conducted a traffic stop on a pick-up truck Sanchez was driving near Raymondville. Sanchez consented to a search, after which authorities discovered two undocumented aliens from Mexico and Guatemala in the tool box that was attached to the pick-up truck.
At the hearing today, the court heard about the inhumane and dangerous treatment of the undocumented aliens. They could not escape the toolbox due to a ladder leaning over it. Further, it had to be unlatched from the outside in order to be opened.
Sanchez will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Customs and Border Protection and Texas Department of Public Safety conducted the investigation. Assistant U.S. Attorney Jose A. Esquivel Jr. prosecuted the case.
Texas Man Pleads Guilty to Transporting Marijuana on the InterstateRead the Press Release
Gulfport, Miss. – Carlos Orozco, 24, of El Paso, Texas, pled guilty today before U.S. District Court Judge Sul Ozerden, to transporting marijuana on the interstate, announced U.S. Attorney Mike Hurst and DEA Special Agent in Charge Stephen G. Azzam.
On April 6, 2017, Orozco traveled with Victor Legarda to Gulfport with approximately 40 kilograms of marijuana. A Gulfport police officer stopped the truck driven by Legarda for a traffic violation on Interstate 10. The tag on the vehicle was associated with another vehicle, and upon making contact with Legarda and Orozco, the officer noticed Legarda was acting extremely nervous. Legarda consented to a search of the vehicle, and the officer located hidden compartments in the vehicle containing vacuum sealed packages of marijuana. In total, 100 packages were removed from the vehicle. After agreeing to talk to law enforcement, Orozco stated that he was aware of the marijuana in the vehicle.
Orozco will be sentenced on June 13, 2018, by Judge Sul Ozerden, and faces a maximum penalty of 5 years in prison and a $250,000 fine.
The case was investigated by the Harrison County Sheriff’s Department, the Gulfport Police Department and the Drug Enforcement Administration. It was prosecuted by Assistant U.S. Attorney Kathlyn R. Van Buskirk.
Sweeny Woman Convicted in Sex Trafficking Conspiracy Involving Three MinorsRead the Press Release
GALVESTON, Texas - A Sweeny woman has pleaded guilty in Galveston federal court to conspiracy and sex trafficking of children, announced U.S. Attorney Ryan K. Patrick.
Angela Marks, 24, was originally charged with nine others as part of a sex trafficking ring that used sexually-oriented websites to advertise their illicit business employing four minors as young as 16 for commercial sex. The young girls were induced into posing for pictures used in online advertisements for sex and engaged in commercial sex acts for money.
Marks was associated with three of the minor victims who began working for the sex trafficking organization in February 2017. Between Feb. 23-27, 2017, Marks was one of the defendants who directed the victims to pose in sexually provocative positions. Pictures were then taken with her phone.
After customers began responding to advertisements on Backpage.com, Marks would use a computer application to communicate with customers and to monitor the three minor victims during prostitution dates. Marks instructed the minor victims on how to conduct prostitution dates and how much to charge. During prostitution dates involving the minors at the Hobby Inn and Stay Express Inn in Houston, Marks would also hide in the hotel bathroom.
She also collected the proceeds from the prostitution dates and provided condoms, food and drugs to the minor victims.
U.S. District Judge George C. Hanks accepted the plea today and set sentencing for May 9, 2018. At that time, Marks faces up to life in prison and a possible $250,000 maximum fine.
The FBI and Texas Department of Public Safety conducted the investigation with assistance of sheriff’s offices in Brazoria and Galveston Counties and police departments in Galveston, Sherman, Wharton, La Marque and the University of Texas Medical Branch.
Assistant U.S. Attorneys Sherri Zack and Sebastian Edwards are prosecuting the case.
Sumter County Man Pleads Guilty in Multi-State Dog Fighting ProsecutionRead the Press Release
Ocala, Florida – United States Attorney Maria Chapa Lopez announces that Patrick W. Riley (67, Sumter County) today pleaded guilty to violating the animal fighting provisions of the federal Animal Welfare Act. He faces up to five years in federal prison and a $250,000 fine.
According to the plea agreement, in November and December 2016, Riley arranged for his dog “Rocket” to participate in animal fighting ventures in Mississippi and Texas. In furtherance of the conspiracy, he trained eight dogs to fight. Riley utilized equipment commonly used to train dogs for fighting, including treadmills, water tanks, turntables, leashes, collars, syringes, needles, intravenous solutions, enemas, laxatives, worming medications, charcoal pills, vitamins, collapsible dog rings, and scales. On March 1, 2017, law enforcement officers executed a search warrant at Riley’s property and seized the dogs and dog training equipment.
The federal Animal Welfare Act makes it a felony to knowingly sell, buy, possess, train, transport, deliver, or receive any animal, including dogs, for purposes of having the animal participate in an animal fighting venture. Under federal law, an animal fighting venture means “any event, in or affecting interstate or foreign commerce, that involves a fight conducted or to be conducted between at least two animals for purposes of sport, wagering, or entertainment.”
This case was investigated by the Federal Bureau of Investigation, the Sumter County Sheriff’s Office, and the Pasco County Sheriff’s Office. It is being prosecuted by Assistant United States Attorney Christopher F. Murray
St. Thomas Men arrested for Possession of a Firearm by Convicted FelonsRead the Press Release
St. Thomas, USVI- Rehelio Trant, 39, and Gamba Potter, 32, both of St. Thomas, made their initial appearances today before U.S. Magistrate Judge Ruth Miller after being charged in an indictment with possession of a firearm by a convicted felon, United States Attorney Gretchen C. F. Shappert announced today. Trant and Potter were detained pending further proceedings. Both are scheduled to be arraigned on Friday.
According to the indictment, on September 8, 2017, the Virgin Islands Police Department received a report from two individuals that Trant and Potter were in possession of firearms that they pointed at them during a robbery. The investigation revealed that Trant was previously convicted in the District Court of possession of a firearm by a convicted felon and Potter was previously convicted in the Superior Court of unauthorized possession of a firearm. Neither Trant nor Potter are licensed in the district of the Virgin Islands to possess a firearm.
Possession of a firearm by a convicted felon carries a maximum sentence of 10 years in prison and a $250,000 fine.
United States Attorney Shappert reminds the public that an indictment is merely a formal charging document and is not evidence of guilt. Every defendant is presumed innocent until and unless proven guilty.
The case is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the VIPD. It is being prosecuted by Assistant United States Attorney Sigrid M. Tejo-Sprotte.
St. Joseph In-home Health Care Worker Indicted for $207,000 Fraud SchemeRead the Press Release
KANSAS CITY, Mo. – Timothy A. Garrison, United States Attorney for the Western District of Missouri, announced that additional charges have been filed against a St. Joseph, Mo., in-home health care nursing assistant for stealing bank account information from one of her clients to illegally transfer more than $207,000 out of her account.
Ashley N. Garr, 33, of St. Joseph, was charged in a 14-count superseding indictment returned by a federal grand jury in Kansas City, Mo. Today’s indictment replaces the original indictment returned on Dec. 5, 2017.
Garr is charged with eight counts of wire fraud, three counts of aggravated identity theft and three counts of filing false tax returns.
Today’s indictment alleges that Garr, through her work as a home health care aid, became friendly with a woman identified as “PLR.” Garr visited the home of PLR in the fall of 2016, the indictment says, and stole checks and checking account information from her. Garr allegedly used the stolen checking account information to pay her personal expenses directly from PLR’s checking account.
Among the various payments, Garr allegedly directed payments on her behalf to the IRS and two student loan accounts. Additionally, Garr allegedly used the checking account information to open and pay credit card accounts. According to the indictment, Garr fraudulently transferred at least $207,638 from the checking account of PLR.
Two of the wire fraud counts relate to a scheme in which Garr allegedly stole personal information from persons she was assisting as a home health care aide. Garr used the stolen information to prepare two false and fraudulent tax returns in 2016, the indictment says, claiming refunds totaling $20,831.
The false tax returns allegedly involved Garr’s personal income tax returns filed in 2015, 2016 and 2017. The indictment alleges that Garr inflated her income in returns filed in 2015 and 2016. Garr claimed $61,725 in wages during 2014, the indictment says, and federal withholding of $30,851. Garr claimed $89,206 in wages in 2015, the indictment says, and federal withholding of $44,593. Garr allegedly failed to report her gross income of approximately $212,892 and reported a gross income of only $26,208 for 2016.
Today’s indictment also contains a forfeiture allegations, which would require Garr to forfeit to the government any property derived from the proceeds of the alleged offenses, including $207,638.
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 Paul S. Becker. It was investigated by the FBI and IRS-Criminal Investigation.
Springfield Tutor Pleads Guilty to Sexual Exploitation of 12-Year-Old StudentRead the Press Release
SPRINGFIELD, Mo. – Timothy A. Garrison, United States Attorney for the Western District of Missouri, announced that a Springfield, Mo., man who worked as a private tutor pleaded guilty in federal court today to the sexual exploitation of a child who was a former student.
John Paul Sparapani, 29, of Springfield, pleaded guilty before U.S. Magistrate Judge David P. Rush to using a minor to produce child pornography.
On Aug. 16, 2017, Sparapani pleaded guilty to receiving and distributing child pornography over the Internet. However, a 12-year-old student who was tutored by Sparapani came forward on Aug. 25, 2017, and disclosed that he sexually assaulted her. When the victim’s mother told her about Sparapani’s child pornography conviction, the child victim disclosed that Sparapani had sexually assaulted her during tutoring sessions since the age of 10.
On Jan. 23, 2018, the court granted Sparapani’s motion to withdraw that guilty plea; the original indictment will be dismissed in lieu of the charge filed today.
An officer with the Southwest Missouri Cyber Crimes Task Force identified Sparapani’s computer as sharing child pornography on a peer-to-peer file-sharing network on May 25, 2015. Officers executed a search warrant at Sparapani’s residence on Dec. 21, 2015, and seized two laptop computers, three hard drives and a cell phone, which contained multiple images and videos of child pornography.
Soon after Sparapani pleaded guilty to the federal indictment stemming from that investigation, a former student disclosed to her mother that Sparapani had sexually assaulted her. According to today’s plea agreement, Sparapani used a private room at a public library for the tutoring sessions. The child victim told investigators that Sparapani took photographs of her with his cell phone. She also said he gave her candy and Pokemon cards as rewards.
Under federal statutes, Sparapani is subject to a mandatory minimum sentence of 15 years in federal prison without parole, up to a sentence of 30 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Ami Harshad Miller. It was investigated by the FBI, the Southwest Missouri Cyber Crimes Task Force and the Springfield, Mo., Police Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
South Carolina Man Sentenced to 20 Years for Attempting to Engage Minors in Sexual ActivityRead the Press Release
Orlando, Florida – U.S. District Judge Roy B. Dalton, Jr. yesterday sentenced Joshua Alan Dunlap (38, South Carolina) to 20 years in federal prison for attempting to entice a minor to engage in sexual activity and traveling to engage in sexual conduct with a minor. The court also ordered him to forfeit an iPhone, which had been used in furtherance of the commission of the offense.
Dunlap pleaded guilty on November 20, 2017.
According to court documents, from July 25 to July 30, 2017, Dunlap communicated with federal and state undercover agents in an attempt to set up meetings with two fictitious minors – ages 11 and 14. He expressed his intent to teach the 11-year-old about bondage, domination, submission, sadistic, and masochist conduct by having sex with her and treating her as his pet and toy. He also said that he wanted to take the girl to his “play dungeon.” Dunlap said that he intended to provide rudimentary sexual education, involving masturbation and oral sex, to the 14-year-old girl. Dunlap was in St. Johns County when he arrived at the home of the older “child.”
During the execution of a search warrant at Dunlap’s home following his arrest, agents found a room consistent with Dunlap’s description of his “play dungeon.” Suitcases containing whips, sex toys, masks, condoms, and personalized dog collars with tags that read “Joshua’s Pet” and “Joshua’s Toy,” were found inside the room, along with a 4-poster bed with chains and eyebolts on the corners.
This case was investigated by the Federal Bureau of Investigation and the St. Johns County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Ilianys Rivera Miranda.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
South Bay Resident Convicted of Illegal Dumping in Wetlands and Other Protected WatersRead the Press Release
OAKLAND – Today, a federal jury convicted James Philip Lucero of three counts of violating the Federal Clean Water Act for illegally discharging pollutants into waters of the United States, including wetlands, announced Acting United States Attorney Alex G. Tse, Environmental Protection Agency Special Agent in Charge Jay Green, and Federal Bureau of Investigation Special Agent in Charge John F. Bennett.
Lucero, of Carmel, California, a self-described “dirt broker,” orchestrated the illegal discharge of pollutants into waters of the United States adjacent to Mowry Slough, near the Don Edwards San Francisco Bay National Wildlife Refuge located in Newark, California. As a dirt-broker, Lucero charged a fee to contractors and trucking companies in exchange for providing open space to dump fill material, including construction debris. The defendant caused a minimum of 1000 industrial-sized truckloads of construction debris and fill material to be dumped on private property containing federally-protected wetlands and other waters of the United States. He did so without obtaining permission of the landowner and without applying for or obtaining a permit from the U.S. Army Corps of Engineers or the Environmental Protection Agency.
“Illegal pollution of our wetlands will be prosecuted vigorously by this office,” said Acting U.S. Attorney Tse. “The verdicts returned by the jury today demonstrate that our community will not tolerate illegal dumping.”
On January 31, 2017, a federal grand jury issued a Superseding Indictment charging Lucero with three counts of unpermitted filling of wetlands and tributaries, in violation of 33 U.S.C. §§ 1311, 1319(c)(2)(A), and 1344. Pursuant to today’s verdict, Lucero was convicted of all three counts.
Assistant U.S. Attorneys Philip J. Kearney and Shiao Lee prosecuted the case with the assistance of Alycee Lane and Helen Yee. The prosecution is the result of an investigation by the Environmental Protection Agency’s Criminal Investigation Division, the Federal Bureau of Investigation, the Alameda County District Attorney’s Office, and the Newark Police Department.
Sioux Falls Man Found Guilty of Methamphetamine ChargesRead the Press Release
United States Attorney Ron Parsons announced that Alvin Felicianosoto, age 34, of Sioux Falls, South Dakota, was found guilty of Conspiracy to Distribute Methamphetamine and Possession with Intent to Distribute Methamphetamine as a result of a federal jury trial in Sioux Falls, South Dakota. The trial began February 12 and ended February 14, 2018.
The conspiracy charge, involving over 500 grams of a mixture containing methamphetamine, carries a mandatory minimum penalty of 10 years and a maximum of life in custody, and/or a $10 million fine, mandatory minimum of 5 years and a maximum of life of supervised release, and a $100 special assessment to the Federal Crime Victims Fund. The possession with intent charge, involving more than 50 grams of pure methamphetamine, carries the same penalty.
Felicianosoto was indicted for possession with intent to distribute by a federal grand jury on November 1, 2016, and a superseding indictment adding the conspiracy charge was filed November 7, 2017.
On July 20, 2016, Felicianosoto was arrested when he attempted to meet a buyer, and he had 114.3 grams of methamphetamine in his possession. Law enforcement searched his residence the next day and recovered 109.5 grams of methamphetamine.
Several witnesses testified about Felicianosoto providing methamphetamine to them for distribution in the Sioux Falls area. The total amount he sold is estimated at over 50 pounds.
This case was investigated by the Sioux Falls Area Drug Task Force and the Drug Enforcement Administration. Assistant U.S. Attorney Jennifer D. Mammenga prosecuted the case.
Felicianosoto was remanded to the custody of the U.S. Marshals Service.
Shreveport man pleads guilty to drug distribution, firearm offenseRead the Press Release
SHREVEPORT, La. – United States Attorney Alexander C. Van Hook announced that a Shreveport man pleaded guilty last week to distributing marijuana and firearm possession.
Xavier Breonte Strickland, 29, of Shreveport, pleaded guilty Thursday before U.S. Magistrate Judge Mark L. Hornsby to one count of possession with intent to distribute marijuana and one count of possession of a firearm in furtherance of a drug trafficking crime. The plea will become final when accepted by U.S. District Judge Elizabeth E. Foote. According to the guilty plea, parole officers went to Strickland’s residence on June 2, 2017 in response to a parole violation. While there, they noticed Strickland exit a bedroom. After searching the bedroom, officers found a Ruger pistol, model: SR1911, caliber: .45 with one round of ammunition in the chamber underneath a green tote bag in the bedroom closet. Next to the bag was a black zipper pouch that contained a digital scale and a bag with 31 grams of marijuana.
Strickland faces up to 20 years in prison for the drug count and no less than five years in prison for the firearms count, which is in addition to the term of imprisonment the court imposes for the drug count. He also faces five years in prison and a $1 million fine. The court set sentencing for June 1, 2018.
The ATF and the Shreveport Police Department conducted the investigation. Assistant U.S. Attorney Brandon B. Brown is prosecuting the case.
Sex Offender Sentenced to 13 Years in Prison for Possessing Child PornographyRead the Press Release
PITTSBURGH - A former resident of Allegheny County, Pennsylvania, has been sentenced in federal court to 156 months imprisonment, followed by a term of lifetime supervised release, on a charge of possession of material depicting the sexual exploitation of a minor, United States Attorney Scott W. Brady announced today.
United States District Judge Mark R. Hornak imposed the sentence on Robert Roy Hegner, age 67, of Sewickley, Pennsylvania.
According to information presented to the court, on August 25, 2016, Hegner possessed images and videos in computer graphic files, the production of which involved the use of minors engaging in sexually explicit conduct, some of whom had not yet attained 12 years of age. Hegner was previously convicted of Indecent Assault, Endangering the Welfare of a Child, Corruption of Minors and Sexual Abuse of Children (F3) in a 1999 case and at the time of this offense was a Megan’s Law Offender.
Assistant United States Attorney Jessica Lieber Smolar prosecuted this case on behalf of the government.
U.S. Attorney Scott W. Brady commended the Federal Bureau of Investigation, the Allegheny County District Attorney Investigations Unit, and the Allegheny County Police Department for conducting the investigation leading to the successful prosecution of Hegner.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals, who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Securities Trader Indicted in Scheme That Netted Tens of Millions of Dollars in Illicit ProfitsRead the Press Release
NEWARK, N.J. – A New Jersey-based securities trader was indicted today on additional charges stemming from his alleged role in orchestrating a massive, long-running market manipulation scheme that netted tens of millions of dollars in illegal profits between 2014 and 2016, U.S. Attorney Craig Carpenito announced.
Joseph Taub, 38, of Clifton, New Jersey, was first charged by complaint with securities fraud conspiracy in 2016. Today’s 13-count indictment charges him with securities fraud conspiracy, market manipulation conspiracy, multiple substantive securities fraud and market manipulation counts, and tax fraud conspiracy. Taub will be arraigned before U.S. District Judge John Michael Vazquez at a later date.
According to documents filed in this case and statements made in court:
From 2014 to 2016, Taub and others conspired to manipulate securities prices of numerous public companies by coordinating trading in dozens of brokerage accounts that they secretly controlled. As part of the scheme, Taub and others engaged in a series of near simultaneous transactions in targeted securities that were designed to artificially influence the market price of the securities and induce other market participants to trade based on the false impression that there was real market interest.
Taub and others allegedly used “straw accounts” that were held in their names, the names of their family members, and the names of entities they controlled. Many of the accounts were opened in the names of individuals who neither controlled the accounts nor traded the securities held in the accounts. Taub funded many of these accounts and used the straw account holders to conceal the scheme from regulators and law enforcement.
The fraudulent trades typically involved two types of straw accounts. First, a “Winner Account” purchased a large block of shares in a particular security. Next, a “Loser Account” placed multiple small orders in the same security to create upward pressure on the stock price. Once the price of the security moved higher due to the Loser Account’s manipulative orders, the conspirators sold their large position in the Winner Account and the shares from any executed trades in the Loser Account. While the Loser Accounts would generally lose money, the conspirators expected the gains from the Winner Accounts to more than make up for them.
In addition, Taub allegedly conspired with accountant Shaun Greenwald, 40, of Cedarhurst, New York, and others to defraud the United States by hiding from the brokerage firms and the IRS the identities of who actually controlled the straw accounts and who reaped the majority of the profits from the scheme. As a result, the profits from the straw accounts were taxed at the lower tax rates applicable to the straw account holders instead of the higher tax rates applicable to Taub and other members of the conspiracy.
The securities fraud conspiracy, market manipulation conspiracy, and tax fraud conspiracy counts each carry a maximum potential penalty of five years in prison. Each substantive count of securities fraud and market manipulation carries a maximum potential penalty of 20 years in prison. All the counts in the indictment also carry a $250,000 fine, or twice of the gross gain or loss from the offenses.
Greenwald pleaded guilty to his role in the scheme on Feb. 21, 2018 and awaits sentencing.
The U.S. Attorney’s Office has filed a separate civil action seeking forfeiture of brokerage accounts in which the manipulative trades were executed, bank and brokerage accounts funded with proceeds of the scheme, and Taub’s interest in companies in which he invested the proceeds of the scheme. Civil forfeiture cases are “in rem” proceedings – proceedings against things. The forfeiture claims in this case are based on allegations that the forfeitable property is proceeds of the securities fraud scheme or is property involved in laundering the proceeds of the scheme. That civil forfeiture action is pending.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen in Newark, and special agents of the U.S. Attorney’s Office, District of New Jersey, with the investigation. He also thanked the SEC’s New York Regional Office for its assistance.
The government is represented by Assistant U.S. Attorneys Daniel Shapiro and Zach Intrater of the U.S. Attorney’s Office Economic Crimes Unit in Newark; and Assistant U.S. Attorneys Sarah Devlin and Barbara Ward, Deputy Chief of the office’s Asset Recovery and Money Laundering Unit.
The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Defense counsel: Lawrence C. Lustberg Esq. and Steven Y. Yurowitz Esq.
Saint Paul Psychiatrist Arrested and Charged with Receipt of Child PornographyRead the Press Release
United States Attorney Gregory G. Brooker today announced a criminal complaint charging AVIEL LI GOODMAN, 62, a licensed psychiatrist, with receipt of child pornography. GOODMAN made his initial appearance today before Magistrate Judge Menendez in United States District Court in Minneapolis, Minn.
According to the complaint and documents filed in court, on multiple occasions between March 1, 2015, and August 27, 2017, undercover agents downloaded numerous image and video files depicting child pornography from IP addresses connected to GOODMAN’S Saint Paul, Minn. residence. On January 17, 2018, upon execution of a search warrant on GOODMAN’S residence, law enforcement seized a computer containing hundreds of image files and multiple video files of suspected child pornography. The images and videos were submitted to the National Center for Missing and Exploited Children (NCMEC) for analysis and victim identification.
If you know of any child who may have been a victim of exploitation, please call the National Center for Missing or Exploited Children (NCMEC) at 1-800-THE-LOST (1-800-843-5678) or visit NCMEC’s web site at www.missingkids.com.
This case is the result of an investigation conducted by the Federal Bureau of Investigation.
This case is being prosecuted by Assistant U.S. Attorneys Katharine T. Buzicky and Carol M. Kayser.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Defendant Information:
AVIEL LI GOODMAN, 62
Saint Paul, Minn.
Charges:
- Receipt of child pornography, 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Romanian Man Facing Fraud Charges for ATM Skimmer SchemeRead the Press Release
PITTSBURGH –A Texas resident has been indicted by a federal grand jury in Pittsburgh on charges of conspiracy to commit bank fraud, bank fraud, and aggravated identity theft, United States Attorney Scott W. Brady announced today.
The three-count indictment named Nicu Sorin Pantelica, age 28, of Houston, Texas.
According to the indictment, Pantelica, a native of Romania, participated in a conspiracy in which he and his conspirators placed skimming devices, along with pinhole cameras, on several automated teller machines throughout the Pittsburgh area. The skimming devices collect the account information contained on the magnetic strips on automated teller machines cards. The pinhole cameras collect personal identification numbers used by customers using the automated teller machines. Pantelica and his conspirators manufactured cloned automated teller machine cards and used those cloned cards and the personal identification numbers to access and withdraw funds from accounts.
The law provides for a minimum sentence of two years in prison and a maximum total sentence of 62 years in prison, a fine of $2,250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Brendan T. Conway is prosecuting this case on behalf of the government.
The United States Secret Service, with the assistance of the South Strabane Police Department, conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Rochester Truck Driver and Photographer Arrested, Charged with Receipt and Possession of Child PorngraphyRead 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 Richard Wolfe, 60, of Rochester, NY, was arrested and charged by criminal complaint with receipt and possession of child pornography. The charges carry a mandatory minimum penalty of five years in prison, a maximum of 40 years and a $250,000 fine, or both.
Assistant U.S. Attorney Melissa M. Marangola, who is handling the case, stated that according to the complaint, in March 2016, a Canadian law enforcement agency executed a search warrant involving a mobile chatting application. Between April 2, 2016, and April 7, 2016, a user with the account name “rickyraz15” used the application to share 331 images of child pornography. The account was traced to the defendant in Rochester.
On October 31, 2017, HSI Buffalo executed a search warrant at Wolfe’s residence on Legran Road in Rochester. Special Agents seized a laptop, two digital cameras, a camcorder, a thumb drive, two SD cards, a cell phone, multiple CD’s, an external hard drive, and miscellaneous documents. During a search of the garage, agents discovered a desktop computer that appeared to have been destroyed by a sledge hammer.
A lockbox was discovered in the closet of an upstairs bedroom. HSI gained entry to the lockbox and found approximately 80 CD’S and an external hard drive. A forensic preview of the external hard drive found several images and videos of child pornography. Some of the images depicted prepubescent minors engaged in sexual situations.
On October 31, 2017, HSI Buffalo executed a second federal search warrant for the defendant’s cell phone, which revealed that the phone had been reset to factory settings.
A forensic examination of the items seized from the defendant is currently pending, but to date, over 2030 images and videos containing child pornography have been recovered.
Wolfe, a full-time truck driver, also works as a part-time professional photographer who has taken pictures of minors.
Members of the public who have specific information related to this case are urged to contact the HSI Buffalo Office at 716-464-5931.
The defendant made an initial appearance this morning before U.S. Magistrate Judge Marian W. Payson 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.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Rochester Tax Return Preparer Indicted for Tax Refund Fraud SchemeRead the Press Release
A federal grand jury returned an indictment today charging a Rochester-based tax return preparer with conspiring to file false claims for tax refunds, theft of public money, and aggravated identity theft, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Gregory G. Brooker for the District of Minnesota.
According to the indictment, MERCEDES MALDONADO RODRIGUEZ, from 2008 through April 2013, operated a tax return preparation business located in Rochester, Minnesota. RODRIGUEZ allegedly purchased authentic birth certificates of Mexican nationals, which she and her co-conspirators then used along with other falsified documents to fraudulently obtain Taxpayer Identification Numbers (ITINs) from the Internal Revenue Service. The indictment further alleges that RODRIGUEZ and her co-conspirators used the fraudulently obtained ITINs to file fraudulent tax returns, which claimed refunds based on, among other items, false dependents and child tax credits. An ITIN is a tax processing number issued by the IRS to individuals who do not have, and are not eligible to obtain, a social security number.
RODRIGUEZ is further alleged to have directed the fraudulent tax refund checks to be mailed to addresses belonging to her co-conspirators, employees, and family members and then cashed.
If convicted, RODRIGUEZ faces a statutory maximum sentence of 10 years in prison for the conspiracy, 10 years in prison for each count of theft of public money and a mandatory sentence of two years in prison for aggravated identity theft. She also faces substantial monetary penalties and restitution.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Brooker commended special agents of IRS Criminal Investigation, U.S. Postal Inspection Service, Homeland Security Investigations, the Federal Bureau of Investigation, the U.S. Secret Service and the Department of Treasury, Office of Inspector General, who investigated the case and Assistant U.S. Attorney Allen A. Slaughter and Trial Attorney Christopher S. Strauss of the Tax Division.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Defendant information:
MERCEDES MALDONADO RODRIGUEZ
Rochester, Minn.
Charges:
- Conspiracy to Defraud the United States with Respect to Claims, 1 count
- Theft of Public Money, 7 counts
- Aggravated Identity Theft, 33 counts
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
Roanoke Man Sentenced on Child Pornography ChargesRead the Press Release
Roanoke, VIRGINIA – United States Attorney Rick A. Mountcastle announced today the sentencing of a Roanoke man who downloaded photographs and images of child pornography.
Richard B. Morgan, 68, was sentenced today in U.S. District Court in Roanoke to 72 months in prison and 10 years of supervised release. In addition, the defendant was ordered to pay a $5,000 fine and a $100 special assessment. Morgan previously pleaded guilty to one count of receipt of child pornography.
According to evidence presented at previous hearings, an investigator with the Southern Virginia Internet Crimes Against Children (ICAC) Task Force successfully downloaded images of child pornography from the defendant via peer-to-peer, file-sharing software often used by those who trade in child pornography. During the execution of a search warrant at Morgan’s apartment, he admitted that he downloaded child pornography. Law enforcement found 1,849 images and 4,406 videos containing child pornography during a forensic examination of Morgan’s computer and an external hard drive.
The investigation of the case was conducted by the Southern Virginia Internet Crimes Against Children Task Force, the Bedford County Sheriff’s Office and U.S. Customs Enforcement, Department of Homeland Security. Assistant United States Attorney Charlene R. Day is prosecuting the case for the United States.
Puerto Rican Man Pleads Guilty to Selling FentanylRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Miguel Figueroa, 32, of Puerto Rico, pleaded guilty to possession with intent to distribute, and to distribute, 10 grams or more of a mixture and substance containing butyryl fentanyl and furanyl fentanyl before U.S. District Judge Richard J. Arcara. The charge carries a maximum penalty of 20 years in prison, a $1,000,000 fine, or both.
Assistant U.S. Attorney Laura A. Higgins, who is handling the case, stated that on March 7, 2017, and April 11, 2017, the defendant sold drugs to a confidential source working for the DEA in exchange for $1,100 cash. Forensic testing determined that the controlled substance sold by Figueroa contained butyryl fentanyl, U-47700, furanyl fentanyl, and fentanyl.
On April 24, 2017, law enforcement officers executed a New York State search warrant at Figueroa’s residence on 15th Street in Buffalo. Officers recovered a plastic bag and five glassine envelopes containing a powder substance. Testing determined that the plastic bag and one of the envelopes contained butyryl fentanyl. Officers also recovered packaging materials, a digital scale, and approximately $3,137 in cash.
The plea 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 Divison.Sentencing is scheduled for June 25, 2018, before Judge Arcara.
Poteau Woman Pleads Guilty to Drug Conspiracy, Methamphetamine DistributionRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Laci Marie Fox a/k/a Laci Marie Noah, age, 27, of Poteau, Oklahoma, pled guilty to Drug Conspiracy, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(A), punishable by not less than 5 or more than 40 years imprisonment, up to a $5,000,000.00 fine, or both; and to Distribution of Methamphetamine, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C), punishable by not more than 20 years imprisonment, up to a $1,000,000.00 fine, or both.
The Indictment alleged that beginning on or about a date uncertain in 2015 and continuing until on or about January 9, 2017, within the Eastern District of Oklahoma and elsewhere, the defendant, did knowingly and intentionally combine, conspire, confederate and agree with others known and unknown to the Grand Jury, to commit offenses against the United States in violation of Title 21, United States Code, Section 841, as follows: possession with intent to distribute and distribution of 50 grams or more of a mixture or substance containing a detectable amount of methamphetamine, a Schedule II controlled substance.The Indictment further alleged that on or about September 1, 2016, within the Eastern District of Oklahoma, the defendant, did knowingly and intentionally distribute a mixture or substance containing a detectable amount of methamphetamine, a Schedule II controlled substance.
The charges arose from an investigation by the Poteau Police Department, the District 16 Narcotics Task Force, and the Oklahoma Bureau of Narcotics.
The Honorable Kimberly E. West, U.S. Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the plea and ordered the completion of a presentence investigation report.
Assistant United States Attorney Christopher Wilson represented the United States.
Pollock prisoner sentenced to 24 months in prison for involuntary manslaughterRead the Press Release
ALEXANDRIA, La. – United States Attorney Alexander C. Van Hook announced that a prisoner at the U.S. Penitentiary in Pollock, La., was sentenced last week to two years in prison for assaulting another inmate who later died.
Lee Adams, 53, of Santa Clara County, Calif., was sentenced Friday by U.S. District Judge Dee D. Drell on one count of involuntary manslaughter. He was also sentenced to five years of supervised release. According to the October 20, 2017 guilty plea, Adams entered a fellow inmate’s cell on October 31, 2014 and beckoned for him to follow. After the inmate entered Adams’ cell, Adams struck the inmate causing him to fall backwards. The back of the inmate’s head struck the floor, and he was found laying motionless. Adams exited the cell and entered the common area. Correctional officers locked down the area and transported the injured inmate to a local hospital where he died on November 4, 2014. The coroner concluded that the inmate sustained a skull fracture and massive injury to the brain, concluding that he died from blunt force to the side of his head that struck the floor. There is no indication that Adams specifically intended to kill the inmate.
The FBI and the U.S. Bureau of Prisons-Special Investigative Services conducted the investigation. Assistant U.S. Attorney Brandon B. Brown is prosecuting the case.
Pollock prisoner pleads guilty to possessing knifeRead the Press Release
ALEXANDRIA, La. – United States Attorney Alexander C. Van Hook announced that a Pollock prisoner pleaded guilty last week to possessing a knife.
Eric Judy Blair, 40, a Pollock prisoner, pleaded guilty Friday before U.S. District Judge Dee D. Drell to one count of possessing contraband in a prison. According to the guilty plea, prison guards were observing inmates going through a metal detector during a random search on June 11, 2017 at the U.S. Penitentiary at Pollock, La. When Blair could not clear the metal detector, he entered a second time and failed again. During a pat down, guards found a homemade metal knife approximately six and one-half inches long.
Blair faces up to five years in prison, one year of supervised release and a $250,000 fine. The court set sentencing for May 18, 2018.
The FBI and the U.S. Bureau of Prisons-Special Investigative Services conducted the investigation. Assistant U.S. Attorney David J. Ayo is prosecuting the case.
Plumbing Franchise Owner Sentenced for OSHA Violation that Caused Employee’s DeathRead the Press Release
PITTSBURGH - A resident in Beaver County, Pennsylvania, has been sentenced in federal court to two years’ probation on his conviction of willfully violating an OSHA regulation causing the death of an employee, United States Attorney Scott W. Brady announced today.
United States Magistrate Judge Cynthia R. Eddy imposed the sentence on Wayne A. George, d/b/a A Rooter Man of Pittsburgh, LLC.
According to the information presented to the court, George was a part owner of A Rooter Man, and was responsible for all of its trench work. Most of that trench work involved excavating, installing and repairing septic systems. OSHA requires employers to provide life-saving cave-in protection in most trenches more than five feet deep. George spent most of his working life as an excavator and was very familiar with those important safety and legal requirements.
The events leading to the death took place on September 28, 2015, at the Shelbourne Personal Care Home in Penn Township, Butler County. George was physically present, operating a backhoe and supervising the replacement of a terra cotta sewer line with PVC pipe. George dug a trench that was 11 feet deep and had a ladder in the trench that was used by his employees to climb in and out of the trench. The trench had no cave-in protection.
The victim, Jacob Casher, was a 21-year-old A Rooter Man employee, who was in the trench at the depth of approximately 11 feet below the surface when the trench collapsed. He was killed instantly.
As a result of its investigation, OSHA issued citations for two willful violations and several serious violations of construction industry safety standards. In response, George paid a penalty of $87,000.
Assistant United States Attorney Nelson P. Cohen prosecuted this case on behalf of the government.
U.S. Attorney Brady commended the U.S. Department of Labor’s Occupational Safety and Health Administration and the Office of the Regional Solicitor for the investigation leading to the successful prosecution of Wayne A. George.
Pittsburgh Woman Sentenced for Health Care Fraud and Prescription Painkiller Distribution SchemeRead the Press Release
PITTSBURGH - A local woman has been sentenced in federal court to three years probation on her conviction of health care fraud and conspiracy to distribute Oxycodone and Oxymorphone, United States Attorney Scott W. Brady announced today.
United States District Judge Mark R. Hornak imposed the sentence yesterday on Angela Vernon, 66, of Pittsburgh, Pennsylvania.
According to information presented to the court, Vernon was part of a group of individuals involved in a large-scale health care fraud and pill distribution network. As part of the criminal enterprise, Vernon and others obtained powerful and addictive prescription pain medication through physicians under the false pretense that they intended to use that medication themselves. In fact, they intended to sell the medication to individuals addicted to those medications. Additionally, medication was often paid for through taxpayer-funded health care insurance programs. Thus, the taxpayers ended paying much of the prescription medications that these conspirators sold.
Assistant United States Attorney Brendan T. Conway is prosecuting these cases on behalf of the government.
United States Attorney Brady commended the Federal Bureau of Investigation and the Drug Enforcement Administration for the investigation leading to the successful prosecution of these defendants.
Pineville man sentenced to 30 months in prison for possessing child pornography onlineRead the Press Release
ALEXANDRIA, La. – United States Attorney Alexander C. Van Hook announced that a Pineville man was sentenced last week to two and a half years in prison for using an online storage site to house child pornography.
Brandon McNamara, 26, of Pineville, La., was sentenced Friday by U.S. District Judge Dee D. Drell on one count of possession of child pornography. He was also sentenced to five years of supervised release and is required to register as a sex offender. According to the August 28, 2017 guilty plea, Canadian law enforcement agents arrested a resident of British Columbia in 2016 for online child pornography distribution. Canadian agents identified McNamara’s online alias as one of 57 different users exchanging child pornography with the Canadian defendant. Canadian agents alerted U.S. law enforcement, and McNamara was questioned on December 9, 2016. He admitted to possessing images of child pornography and said they were being stored on an online storage account.
This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood combines federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The U.S. Department of Homeland Security and U.S. Immigration & Customs Enforcement (ICE) also encourage the public to report suspected child predators and any suspicious activity through its toll-free hotline at (866) 347-2423. Investigators are available at all hours to answer hotline calls. Tips or other information can also be submitted to ICE online by visiting their website at www.ice.gov/exec/forms/hsi-tips/tips.asp or through the Operation Predator smartphone application www.ice.gov/predator/smartphone-app. Tips may be submitted anonymously.
The U.S. Department of Homeland Security and the Vancouver Royal Canadian Mounted Police conducted the investigation. Assistant U.S. Attorneys Jamilla A. Bynog and David J. Ayo prosecuted the case.
Phenix City Chiropractor and Two of His Employees Arrested on Federal ChargesRead the Press Release
Montgomery, Ala. – Dr. Kenneth G. Edwards, 64, a resident of Columbus, Georgia, and two of his employees, Joann Bush, 58, and Andrea Daigle, 40, both from Smiths Station, Alabama, were arrested yesterday after being indicted by a federal grand jury, announced United States Attorney Louis V. Franklin, Sr. Dr. Edwards owns and operates a chiropractic practice in Phenix City, Alabama.
All three defendants face conspiracy, wire fraud, and conspiracy to commit wire fraud charges. Additionally, Dr. Edwards and Joann Bush are charged with making false statements and falsification of federal records.
The indictment alleges that Dr. Edwards and his employees orchestrated a scheme to submit false documents to the United States Department of Transportation (USDOT). Those false documents related to the physical exams of truck drivers and prospective truck drivers that were conducted at his chiropractic office. The USDOT requires that all truck drivers undergo an initial physical examination before receiving a commercial driver’s license (CDL), and that they have subsequent examinations every two years thereafter to maintain the license. According to the indictment, Dr. Edwards and his staff did not perform physicals that were up to USDOT standards. They would then send forms to the USDOT that falsely certified the truck drivers had passed all of the USDOT physical exam requirements.
If convicted of the most serious charges, each defendant faces a maximum sentence of 20 years’ imprisonment. There is no parole in the federal system. They also face substantial monetary penalties and restitution.
An indictment merely alleges that crimes have been committed. Each defendant is presumed innocent until proven guilty beyond a reasonable doubt.
This case was investigated by the United States Department of Transportation’s Office of Inspector General, with assistance from the Alabama Law Enforcement Agency. Assistant United States Attorneys Jonathan S. Ross and Steven H. Lee are prosecuting the case.
Pharmacy Tech Sentenced to Five Years in Prison for Tampering with Opioids for IV FluidRead the Press Release
BIRMINGHAM – A federal judge today sentenced a former lead technician at a central Alabama pharmacy to five years in prison for tampering with vials of opioid painkillers used in the compounding of intravenous fluid bags intended for terminally ill patients in debilitating pain.
U.S. Attorney Jay E. Town, Drug Enforcement Administration Assistant Special Agent in Charge Bret Hamilton and Food and Drug Administration, Office of Criminal Investigations, Acting Special Agent in Charge Peter Kuehl announced the sentence.
U.S. District Judge R. David Proctor sentenced JOHNATHON WILLIAM CLICK , 30, of Bessemer, on one-count of tampering with consumer products in reckless disregard for the risk that another person would be placed in danger of death or bodily injury, and under circumstances manifesting extreme indifference to that risk. Click pleaded guilty to the charge in November.
“Jonathan Click knew he was inflicting untold pain and suffering on terminally ill cancer patients, yet for two years he diluted their medication and took the opioid drugs for himself,” U.S. Attorney Town said. “Mr. Click is going to prison for his crime, and he will be joined shortly by those like him.”
“Patients deserve to have confidence that they are receiving the proper treatment from those entrusted with providing their medical care,” said FDA Acting Special Agent in Charge Kuehl. “That’s why we must hold medical personnel accountable when they take advantage of their unique position and tamper with drugs needed by their patients, especially when such tampering causes additional pain and suffering for those who are terminally-ill.”
“DEA is committed to investigating and bringing to justice those who divert prescription drugs. Opiate abuse is a major problem across the nation, with over four million Americans addicted to prescription drugs,” DEA Assistant Special Agent in Charge Hamilton said. “The sentencing of this pharmacy technician should send a clear message to those within the medical profession. DEA will continue to work with our federal, state and local law enforcement and regulatory partners to prosecute you to the fullest extent of the law.”
Click worked at Birmingham-based ContinuumRx of Central Alabama, which primarily distributes IV bags containing morphine and hydromorphone for palliative care of patients in hospice or homecare. The majority of CRX’s patients were terminally ill with cancer and suffering breakthrough pain. Click, as the lead pharmacy technician, prepared the vast majority of CRX’s IV bags, which helped safeguard his scheme, according to court documents.
Between December 2014 and September 2016, when CRX ended Click’s employment, he removed morphine sulfate and hydromorphone hydrochloride from vials intended for use in mixing IV bags. He diluted the vials to hide his theft, knowing that patients in excruciating pain would receive the diluted pain medication, according to the government’s sentencing memorandum. The document states that Click stole the medication so he could feed his opioid addiction.
“The nature and circumstances of this offense shock the conscience,” the government said in its sentencing memorandum. Click’s victims “were painfully dying – because the defendant tampered with their medicine for his own gratification. In their final days on earth, the defendant denied them the comfort of pain remediation they so desperately needed. The defendant knew what he was doing each time he tampered with those vials of medicine.”
According to the sentencing memorandum and Click’s plea agreement, he surreptitiously removed vials of morphine and hydromorphone from CRX’s locked inventory, withdrew drugs from the vials with a syringe and replaced the withdrawn amount with saline or sterile water. Click then would return the adulterated and diluted vials to the inventory, undetected, and later use the vials to compound IV bags that were distributed and administered to homecare and hospice patients. CRX’s primary customers are Alacare Home Health & Hospice, New Beacon Hospice, Lakeview Homecare & Hospice, Comfort Care Hospice and Kindred Hospice.
DEA, FDA and the Alabama Board of Pharmacy investigated the case, which Assistant U.S. Attorney Mohammad Khatib prosecuted.
Pascagoula Man Pleads Guilty to Meth ConspiracyRead the Press Release
Gulfport, Miss. – Tharon Jamell Taylor, 27, of Pascagoula, Mississippi, pled guilty yesterday before U.S. District Court Judge Sul Ozerden to conspiracy to possess with intent to distribute 500 grams or more of methamphetamine, announced U.S. Attorney Mike Hurst and FBI Special Agent in Charge Christopher Freeze.
On August 20, 2017, a cooperating source made a controlled delivery of 1,964 grams of 100% pure methamphetamine to Taylor. Prior to the delivery, a recorded phone call was placed by the cooperating source to Taylor, and during the call, Taylor requested that they meet at his apartment in Ocean Springs. Taylor met the cooperating source in the apartment’s parking lot, and agents quickly arrested Taylor when he reached for the bag in which the methamphetamine was located. The cooperating source provided information to law enforcement that he had previously delivered narcotics from Texas to Taylor. Upon arresting Taylor, law enforcement searched his apartment and found money, a scale, methamphetamine, and a stolen handgun.
Taylor will be sentenced on June 26, 2018, by Judge Ozerden, and faces a maximum penalty of life in prison and a $10 million fine.
The case was investigated by the FBI Safe Streets Task Force in Pascagoula, and prosecuted by Assistant U.S. Attorney Kathlyn R. Van Buskirk.
Panamanian Company Pleads Guilty to Bribing Soccer OfficialRead the Press Release
Earlier today, in federal court in Brooklyn, Mimo International Imports and Exports, Inc. (Mimo) pleaded guilty to wire fraud conspiracy in connection with its agreement to pay a $500,000 bribe to Eduardo Li, who was president of the Costa Rican soccer federation (FEDEFUT) at the time of the bribe. Mimo, which is a privately held corporation organized under the laws of Panama, paid over $300,000 of this agreed-upon bribe before Li was arrested in Zurich, Switzerland on May 27, 2015. Pursuant to a plea agreement with the government, Mimo was sentenced today to pay $500,000 in restitution to FEDEFUT and a $900,000 fine. Also pursuant this plea agreement, Mimo agreed to dissolve its corporate existence within 90 days. Today’s plea and sentencing proceedings took place before United States District Judge Pamela K. Chen.
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 R. Damon Rowe, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation, Los Angeles Field Office (IRS CI), announced the guilty plea.
“The defendant company Mimo agreed to bribe the president of the Costa Rican soccer federation, depriving the federation of $500,000 as well as of its president’s honest services,” stated U.S. Attorney Donoghue. “As a result of the government’s investigation bringing this bribery scheme to light, Mimo admitted its guilt and will make full restitution to the federation, pay a $900,000 fine, and cease operations.”
“This plea is just one in an increasing pile of investigations and cases the FBI and our law enforcement partners from around the world have been pursuing for years,” stated FBI Assistant Director-in-Charge Sweeney. “It shows we're not slowing down in our efforts to stop greedy, criminal behavior casting a dark shadow on a game the world reveres. There will be more to come, and we won't stop until those who take money under the table and use it for their own illicit purposes get the message that they will get caught.”
“Today’s guilty plea is a clear demonstration of IRS Criminal Investigation’s continued commitment to pursue financial crimes, including those which further corruption in the world of international soccer,” stated IRS CI Special Agent-in-Charge Rowe. “IRS CI is committed to ending these practices and bringing bad actors, including corporate entities, to justice.”
According to court filings and facts presented during the plea proceeding, Mimo provided athletic apparel and sponsorship fees to FEDEFUT pursuant to a 2012 sponsorship agreement that was to run through 2018. In 2014, Mimo sought for FEDEFUT to terminate the 2012 sponsorship agreement, because if FEDEFUT terminated that agreement, Mimo’s owners would receive a multi-million dollar rescission fee. To induce Li to terminate the 2012 sponsorship agreement, Mimo agreed to pay Li a bribe of $500,000.
Li then terminated the 2012 agreement and on behalf of FEDEFUT entered into a sponsorship agreement with an American sports apparel company. Mimo paid Li over $300,000 of the $500,000 bribe, in United States currency, before Li’s arrest on May 27, 2015 in Zurich, Switzerland. Mimo representatives did not tell the American sports apparel company about the bribe, and told Li not to tell the American sports apparel company about it. Li pleaded guilty to racketeering conspiracy and other offenses on October 7, 2016, and admitted in his allocution, among other things, that he had agreed to this bribe.
The guilty plea announced today is part of an investigation into corruption in international soccer led by the U.S. Attorney’s Office for the Eastern District of New York, the FBI New York Field Office, and the IRS-CI Los Angeles Field Office. The prosecutors in Brooklyn are receiving considerable assistance from attorneys in various parts of the Justice Department’s Criminal Division in Washington, D.C., including the Office of International Affairs, the Organized Crime and Gang Section, the Money Laundering and Asset Recovery Section, and the Fraud Section, as well as from INTERPOL Washington.
The government’s case is being handled by the Office’s FIFA Task Force. Assistant United States Attorney Paul Tuchmann of the Eastern District of New York is in charge of the prosecution.
The Defendant:
MIMO INTERNATIONAL IMPORTS AND EXPORTS, INC.
Place of Incorporation: PanamaE.D.N.Y. Docket No. 18 CR 59 (PKC)
Oregon man pleads guilty to failing to register as a sex offender after moving to GeorgiaRead the Press Release
ATLANTA - Timothy Chenault, who traveled from Oregon to Georgia but then did not register as a sex offender here, has pleaded guilty to a charge of failing to update or maintain his status on the Sex Offender Registry.
“Citizens have a right to know if they live or work near a sex offender,” said U.S. Attorney Byung J. “BJay” Pak. “This is a matter of public safety. Sex offenders who do not believe they must register any longer will be found and held accountable for their willful failure to comply with the law.”
“The enforcement of the Sex Offender Registration and Notification Act is a priority of the U.S. Marshals Service and we will continue to monitor and seek out those who are under the requirements of the Act to ensure compliance. We will move and take actions against individuals when we find noncompliance,” said Beverly Harvard, U.S. Marshal for the Northern District of Georgia.
According to U.S. Attorney Pak, the charges and other information presented in court: The Sex Offender Registration and Notification Act requires people who commit certain sex crimes to register as sex offenders regardless of what state they live in or what state they move to. In this case, in June 1992, Timothy Chenault lured a 14-year-old girl to a field in Oregon, where he sexually assaulted her and threatened to harm her if she told anyone what he did. He was convicted in November 1992 of attempt to commit rape and sexual abuse. This conviction required him to register as a sex offender, and, indeed, he did register in Oregon when he was released from prison in 1994. He continued to register through December 2013.
However, by February 13, 2015, Chenault had moved to Georgia. He never informed law enforcement in Oregon that he was leaving that state, nor did he ever registered as a sex offender while living in Georgia.
Sentencing for Timothy Chenault, 48, of Atlanta, Georgia, is scheduled for May 15, 2018, at 9:30 a.m. before U.S. District Judge William S. Duffey Jr.
This case is being investigated by the U.S. Marshals Service.
Assistant U.S. Attorney Paul R. Jones is prosecuting the case.
This case is being brought as part of Project Safe Childhood. In February 2006, the Attorney General launched Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorney’s Offices around the country, Project Safe Childhood marshals federal, state and local resources to apprehend and prosecute individuals who exploit children. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Operator of Bitcoin Investment Platform Charged with Perjury and Obstruction of JusticeRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced that JON E. MONTROLL, a/k/a “Ukyo” was taken into federal custody today for giving false sworn testimony and false documentation to the staff of the New York Regional Office of the Securities Exchange Commission (“SEC”). The defendant is expected to be presented this afternoon in U.S. District Court for the Northern District of Texas, before U.S. Magistrate Judge Jeffrey L. Cureton.
Manhattan U.S. Attorney Geoffrey S. Berman said: “SEC investigations rely on learning the full and accurate facts concerning financial markets and products. As alleged, the defendant repeatedly lied during sworn testimony and misled SEC staff to avoid taking personal responsibility for the loss of thousands of his customers’ bitcoins. These charges signify that we will use the full force of the federal criminal law to protect the integrity of the SEC’s investigative process.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. said: “As alleged, Montroll committed a serious crime when he lied to the SEC during sworn testimony. In an attempt to cover up the results of a hack that exploited weaknesses in the programming code of his company, he allegedly went to great lengths to prove the balance of bitcoins available to BitFunder users in the WeExchange Wallet was sufficient to cover the money owed to investors. It’s said that honesty is always the best policy – this is yet another case in which this virtue holds true.”
According to the allegations in the Complaint filed today in Manhattan federal court:[1]
JON E. MONTROLL operated two online bitcoin services: WeExchange Australia, Pty. Ltd. (“WeExchange”) and BitFunder.com (“BitFunder”). WeExchange functioned as a bitcoin depository and currency exchange service. BitFunder facilitated the purchase and trading of virtual shares of business entities that listed their virtual shares on the BitFunder platform.
During the summer of 2013, one or more individuals (the “Hackers”) exploited a weakness in the BitFunder programming code to cause BitFunder to credit the Hackers with profits they did not, in fact, earn (the “Exploit”). As a result, the Hackers were able to wrongfully withdraw from WeExchange approximately 6,000 bitcoins, with the majority of those coins being wrongfully withdrawn between July 28, 2013, and July 31, 2013. In today’s value, the wrongfully withdrawn bitcoin were worth more than $60 million. As a result of the Exploit, BitFunder and WeExchange lacked the bitcoins necessary to cover what MONTROLL owed to users.
In November 2013, MONTROLL provided sworn testimony to the SEC’s New York Regional Office in connection with their investigation into the Exploit and BitFunder’s activities. In that testimony, MONTROLL denied that the Exploit had been successful, testifying that, “When [the Hackers] went to withdraw, the system stopped them because the amount was obviously causing issues with the system.” MONTROLL later added that the software issue “was corrected immediately, whenever the system started having the problems, and I caught on to what was happening I’d say within a few hours.”
MONTROLL also produced to the SEC a screenshot purportedly documenting, among other things, the total number of bitcoins available to BitFunder users in the WeExchange Wallet as of October 13, 2013 (the “Balance Statement”). The Balance Statement reflected “6,679.78 BTC” on hand as of that date. In discussing the Balance Statement in his sworn testimony, MONTROLL explained that it represented “the collective pool of funds held for users on BitFunder. The collective pool of BTC held for users on BitFunder – users who transfer bitcoins to BitFunder, this is the total amount that’s being held by BitFunder of those users.”
Contemporaneous digital evidence, including chat logs and transaction data, revealed that the Balance Statement was a misleading fabrication. Three days into the Exploit, MONTROLL had participated in an internet relay chat with another person (“Person-1”) in which he sought help in tracking down “Stolen coins.” When that did not work, MONTROLL transferred some of his own bitcoin holdings into WeExchange to conceal the losses. The Exploit, however, continued. By the time of the Balance Statement, WeExchange actually held thousands of bitcoins less than MONTROLL had asserted through the false Balance Statement.
When confronted with that evidence during subsequent testimony, MONTROLL lied to SEC staff again. While MONTROLL admitted that the Balance Statement was the product of his manual intervention in the WeExchange system, he claimed to have discovered the success of the Exploit only after the SEC had asked him about it during his first day of testimony and to have no knowledge of the chat with Person-1.
* * *
MONTROLL, 37, of Saginaw, Texas, is charged with two counts of perjury and one count of obstruction of justice. The perjury counts each carry a maximum penalty of five years in prison. The obstruction of justice count carries a maximum penalty of 20 years in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Berman praised the outstanding work of the FBI. He also thanked the SEC, which has filed civil charges against MONTROLL in a separate action.
The prosecution of this case is being overseen by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Andrew Thomas is in charge of the case.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint, and the description of the Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Operation Hardest Hit Heroin Trafficker Sentenced to PrisonRead the Press Release
NORFOLK, Va. – A Portsmouth man was sentenced today to 24 years in prison for his role in a massive heroin and fentanyl drug trafficking conspiracy.
According to court documents, on Aug. 14, 2017, over 300 law enforcement agents made arrests and executed search warrants in Virginia, Georgia, and New York. The takedown was the result of a multi-year, multi-jurisdictional, and multi-agency Organized Crime Drug Enforcement Task Force (OCDETF) investigation designated Operation Hardest Hit.
According to court documents, law enforcement began investigating Leroy Perdue and his drug trafficking organization (Perdue DTO) in early 2016 following the heroin overdose death of a young resident of Chesapeake. With the participation of nearly two dozen Confidential Human Sources, law enforcement infiltrated the Perdue DTO and made 10 undercover controlled purchases of heroin and fentanyl. On June 22, the investigative team arrested Rhadu Schoolfield, 33, of Portsmouth, in Norfolk with more than 800 grams of heroin after he returned from a trip to New York. According to the indictment, the Perdue DTO distributed in excess of 100 kilograms of heroin (approximately 250,000 doses) over a 10-year period. Members of the Perdue DTO were responsible for supplying a violent gang based in Portsmouth and continued to sell dangerous narcotics even after learning that their drugs resulted in death.
Schoolfield, who was the chief lieutenant and face of the drug trafficking organization, was sentenced today to 24 years in prison. Schoolfield managed his own network of distributors, traveled between New York and Baltimore to obtain wholesale amounts of raw heroin to bring back for distribution in Hampton Roads, and used his status as a local celebrity and rapper to advertise and recruit for the organization. Those advertising and recruiting efforts included his posting on YouTube the music video for his single, “Dumb Hard,” which lyrics cast his criminal conduct in a positive light.
The dozen individuals below previously pleaded guilty. The leader of the DTO, Leroy Perdue, is scheduled for trial on May 15.
Name, Age
Hometown
Guilty Plea
Sentence
Abraham Atkins, 35
Portsmouth
September 5, 2017
20 Years
Eddie L. Tyson, 46
Portsmouth
September 5, 2017
15 Years
Edward Muckle, 32
Portsmouth
September 5, 2017
9 years
Jamars Cooper, 26
Portsmouth
September 5, 2017
11 years
Victoria Waller, 42
Portsmouth
September 6, 2017
10 years, 6 months
Dominic Diablo Mosley, 35
Portsmouth
September 6, 2017
15 years
Nicholas Godwin, 37
Portsmouth
September 6, 2017
12 years, 4 months
Kevin Lawrence, 37
Portsmouth
September 7, 2017
13 years
Tywon McKelvy, 42
New York
October 3, 2017
March 7
Darion Perdue, 24
Portsmouth
October 17, 2017
March 19
Christina James
New York
October 18, 2017
5 years
Rhadu Schoolfield, 33
Portsmouth
October 18, 2017
24 years
Tracy Doherty-McCormick, Acting U.S. Attorney for the Eastern District of Virginia, Mark R. Herring, Attorney General of Virginia, Martin Culbreth, Special Agent in Charge of the FBI’s Norfolk Division, Michael K. Lamonea, Assistant Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Norfolk, Thomas L. Chittum, III, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, Kelvin L. Wright, Chief of Chesapeake Police, Colonel Gary T. Settle, Virginia State Police Superintendent, and Tonya D. Chapman, Chief of Portsmouth Police, made the announcement after sentencing by U.S. District Judge Raymond A. Jackson.
This case was investigated by the FBI’s Tidewater Violent Crime Task Force, in partnership with HSI’s Norfolk Field Office, ATF, Chesapeake Police Department, Virginia State Police, and the Portsmouth Gang Suppression Unit. Special Assistant U.S. Attorney John F. Butler and Assistant U.S. Attorneys Joseph E. DePadilla, Andrew C. Bosse, and William B. Jackson, are prosecuting the case.
This case was investigated as part of the Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program is a federal, multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:17-cr-116.
Ohio man pleads guilty to federal drug crimeRead the Press Release
HUNTINGTON, W.Va. – An Ohio man who sold crack to an informant in September 2016 pled guilty today to a federal drug crime, announced United States Attorney Mike Stuart. Stephen Somon, 44, of Ironton, entered his guilty plea to aiding and abetting the distribution of crack. U.S. Attorney Stuart commended the investigative efforts of the Bureau of Alcohol, Tobacco, Firearms and Explosives.
“If you sell your poison in Huntington, you’re making a big mistake, and it will cost you dearly,” said U.S. Attorney Stuart. “We’re taking back the streets of Huntington and the only hospitality we are offering drug dealers is a long stay in a prison cell, and that cell doesn’t come with turn down service or a chocolate on the pillow.”
On September 13, 2016, law enforcement used a confidential informant to arrange a drug deal for crack in the area of the Little Caesar’s on 1st Street in Huntington. Somon admitted that he arrived and gave the informant crack in exchange for $850. As part of the plea agreement, Somon also admitted that he allowed others to reside at his residence for the purpose of distributing crack.
Somon faces up to 20 years in federal prison when he is sentenced on May 29, 2018.
Assistant United States Attorneys Joseph F. Adams and Stephanie S. Taylor are handling the prosecution. The plea hearing was held before United States District Judge Robert C. Chambers.
This prosecution is 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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Ohio Man Admits Crashing through Security Gate at FBI-Pittsburgh HeadquartersRead the Press Release
PITTSBURGH - An Ohio resident pleaded guilty in federal court to a charge of willfully injuring or committing depredation against any property of the United States, United States Attorney Scott W. Brady announced today.
Thomas Ross, age 49, formerly of New Waterford, Ohio, pleaded guilty to one count before Chief United States District Judge Joy Flowers Conti.
In connection with the guilty plea, the court was advised that on July 26, 2016, Ross drove his vehicle, a large dump truck, through the gate of the FBI Pittsburgh Field Office, located at 3311 East Carson Street, in Pittsburgh. Ross proceeded to ram through the security barriers at a high rate of speed, inflicting extensive damage on the gate and security barriers and causing the vehicle to become airborne. Upon hitting the ground, the vehicle struck a nearby light post in the interior parking lot of the FBI Pittsburgh.
The court was advised that the total amount of loss attributable to Ross’s actions will be determined at sentencing. The government estimates that the cost to repair and replace the gate and security barriers struck by Ross’s vehicle was approximately $175,000, and that the cost to repair the light post was approximately $13,684. The government also advised the court that, while the gate and security barriers were being repaired, the FBI also hired additional security personnel at additional cost to the FBI.
Judge Conti scheduled sentencing for June 13, 2018. The law provides for a maximum total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Adam N. Hallowell is prosecuting this case on behalf of the government.
The Pittsburgh FBI and Pittsburgh Bureau of Police conducted the investigation that led to the prosecution of Thomas Ross.
Norwich Man Sentenced to 51 Months in Prison for Distributing Oxycodone, Violating Supervised ReleaseRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that RODNEY T. MORGAN, 48, of Norwich, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to 51 months of imprisonment, followed by three years of supervised release, for distributing oxycodone, and for violating the conditions of his supervised release from a prior federal conviction.
According to court documents and statements made in court, on November 23, 2010, Judge Chatigny sentenced MORGAN to 49 months of imprisonment, followed by six years of supervised release, for distributing oxycodone, cocaine and crack cocaine. MORGAN was released from prison in July 2013 and began serving his six-year term of supervised release.
In October 2016, the Norwich Police Department received information that MORGAN was receiving large shipments of prescription pills and kept a supply of the narcotics at a friend’s residence in Stonington. On October 12, 2016, detectives stopped MORGAN’s car after he drove away from the Stonington residence. A search of the car revealed more than 100 oxycodone pills. Detectives subsequently located more than 300 oxycodone pills inside the residence.
MORGAN has been detained since his arrest on October 12, 2016. On January 5, 2017, he pleaded guilty to one count of possession with intent to distribute oxycodone. On that date, he also admitted that he violated the terms of his supervised release.
This is MORGAN’s third federal conviction.
This case was prosecuted by Assistant U.S. Attorneys Sarah P. Karwan and Anthony P. Kaplan.
Northern Idaho Woman Pleads Guilty to Theft of Government FundsRead the Press Release
COEUR D’ALENE – Heather R. King, 31, of Coeur d’Alene, Idaho, pleaded guilty yesterday to theft of government funds, U.S. Attorney Bart M. Davis announced.
According to court records, King’s daughter received Supplemental Security Income (SSI) benefits administered by the Social Security Administration (SSA). King served as her daughter’s representative payee because her daughter was a minor child. From May 17, 2014, through October 1, 2015, King did not have custody of her daughter, but she continued to receive her daughter’s SSI benefits. King did not contact the SSA to report that her daughter no longer lived with her. Instead, she stole her daughter’s SSI benefits and converted them to her own use.
The charge of theft of government funds is punishable by up to ten years in prison, a maximum fine of $250,000, and a term of up to three years of supervised release. Sentencing is set for May 22, 2018, before the Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Coeur d’Alene.
This case was investigated by the Social Security Administration Office of Inspector General.
North Las Vegas Man Indicted for Unlawful Possession of Pipe BombRead the Press Release
LAS VEGAS, Nev. – A previously convicted felon was charged today for possession of a 12-inch pipe bomb that was found in a North Las Vegas house, announced U.S. Attorney Dayle Elieson of the District of Nevada.
Christopher Michael Robinson, 46, of North Las Vegas, is charged with one-count of unlawful possession of a destructive device and one-count of felon in possession of a firearm. His initial appearance in court is scheduled for March 1, 2018, before U.S. Magistrate Judge Nancy J. Koppe.
According to the indictment and criminal complaint, on January 11, 2018, North Las Vegas Police Department officers requested assistance from the Las Vegas Metropolitan Police Department, the Las Vegas Fire & Rescue, and the FBI related to a pipe bomb in a house. The house’s resident indicated that he had evicted Robinson for nonpayment of rent and that Robinson had in turn threatened to “blow up the house.” Bomb technicians used a robot to remove a 12-inch pipe bomb from the house. After inspection, it was determined that the pipe contained match heads, a pyrotechnic powder, and BB pellets (for fragmentation). During an interview with law enforcement, Robinson admitted to constructing the pipe bomb and stated that he was currently on parole in Hawaii for previously manufacturing a pipe bomb.
In addition to the current possession of a destructive device charge, Robinson is charged with being a former felon in possession of a destructive device after multiple prior felony convictions in Clark County, Nevada, and Hawaii.
If convicted, Robinson will face the statutory maximum penalty of 10 years in prison and a $250,000 fine per each count.
The case is a joint investigation by the FBI, the North Las Vegas Police Department, the Las Vegas Metropolitan Police Department, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Phillip N. Smith Jr. is prosecuting the case.
This case was brought as part of Project Safe Neighborhoods (PSN), a nationwide program by the Department of Justice 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. For more information about PSN, visit www.justice.gov/usao-nv.
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Niagara County Man Sentenced on Child Pornography and Cyberstalking ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Timothy Laubacker, 26, of Lockport, NY, who was convicted of enticement of a minor to engage in sexual activity and cyberstalking, was sentenced to 180 months in prison and lifetime supervised release by U.S. District Judge Lawrence J. Vilardo.
Assistant U.S. Attorney Mary C. Baumgarten, who handled the case, stated that in September 2015, a female victim reported to the Niagara County Sheriff’s Department that she received unsolicited communications from an individual on Facebook. The individual threatened to distribute and post images that the female victim sent to her then-boyfriend when she was about 14 years-old.
During the investigation, it was determined that Laubacker was the individual who had contacted the female victim on Facebook. The investigation further determined that the co-defendant Travis Guerriera, who had possession of the images that the victim had previously shared with her former boyfriend, had provided such images to Laubacker.
In June 2015, Laubacker attempted to entice a second victim, a minor, via Facebook to produce images of child pornography. When the minor victim refused to comply, Laubacker threatened to distribute child pornography images that he had previously obtained from the victim. Laubacker’s threats continued until November 2015.
Laubacker made initial contact with the minor victim during his former employment as a behavioral health aide at a mental health facility. Laubaker was terminated from that employment in late December 2015 for inappropriate communications with another minor female.
Co-defendant Travis Guerriera was convicted of possession of child pornography and cyberstalking and faces a maximum penalty of 10 years when sentenced on March 14, 2018.
Today’s sentencing is the result of an investigation by the Federal Bureau of Investigation, Child Exploitation Task Force, under the direction of Acting Special Agent-in-Charge Kevin P. Lyons, and the Niagara County Sheriff’s Department, under the direction of James Voutour.
New York Man Pleads Guilty to Attempting to Provide Material Support to ISIS and Passport FraudRead the Press Release
Sajmir Alimehmeti, aka, Abdul Qawii, 24, of the Bronx, New York, pleaded guilty today to attempting to provide material support to the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization, and to committing passport fraud in order to facilitate an act of international terrorism. Alimehmeti pleaded guilty today to a Superseding Indictment in Manhattan federal court before U.S. District Judge Paul A. Engelmayer.
Acting Assistant Attorney General for National Security Edward C. O’Callaghan and U.S. Attorney Geoffrey S. Berman for the Southern District of New York made the announcement.
According to the allegations in the Superseding Indictment and the Complaint filed in this case, statements made during the plea proceeding, and other documents filed in the public record:
In October 2014, Alimehmeti attempted to enter the United Kingdom but was denied entry after U.K. authorities found camouflage clothing and nunchucks in his luggage. About two months later, in December 2014, Alimehmeti was again denied entry into the United Kingdom, this time after U.K. authorities found that his cellphone contained images of ISIS flags. Further forensic examination of the contents of the cellphone and Alimehmeti’s laptop computer showed numerous indicia of Alimehmeti’s support for ISIS, including a photograph of Alimehmeti with an ISIS flag in the background, images of ISIS fighters in the Middle East, a photograph of Alimehmeti making a gesture of support for ISIS, various files relating to jihad and martyrdom, and electronic communications in which Alimehmeti assisted another ISIS supporter in efforts to travel to Syria to join ISIS by providing contact information for an ISIS affiliate who could facilitate the travel.
After returning to the United States, Alimehmeti continued to support ISIS. Among other things, Alimehmeti displayed an ISIS flag in his apartment in the Bronx and, in the course of recorded meetings with undercover law enforcement employees, Alimehmeti played multiple pro-ISIS propaganda videos on his computer and cellphone, including videos of ISIS fighters decapitating prisoners, and also indicated that he was interested in radicalizing other individuals in the Bronx area. Alimehmeti also made repeated purchases of combat knives and other military-type equipment, including masks, handcuffs, a pocket chainsaw, a wire pocket saw and a rucksack designed for tactical combat, which he stockpiled at his apartment in the Bronx.
In October 2015, Alimehmeti applied for a U.S. passport, falsely claiming in the application that his previous passport had been lost. Alimehmeti later told an undercover law enforcement employee that his prior passport – which Alimehmeti showed to the undercover law enforcement officer – had not been lost and, instead, that he was applying for a new passport because he believed the rejection stamps in his existing passport resulting from his attempted entries into the United Kingdom would make it difficult to travel. Alimehmeti further conveyed to undercover law enforcement personnel that he was seeking the new passport, without rejection stamps, to facilitate his travel overseas to join and fight for ISIS.
In May 2016, Alimehmeti attempted to assist an individual who was purportedly traveling from New York to Syria to train and fight with ISIS but who was actually an undercover law enforcement employee (UC). On May 17, 2016, Alimehmeti met with the UC in Manhattan. The UC had purportedly arrived in New York earlier that day on a bus and was en route to John F. Kennedy International Airport (JFK Airport) to take an overseas flight later that night.
Alimehmeti agreed to help the UC with several tasks prior to the UC’s purported travel. Alimehmeti assisted the UC by locating stores so the UC could purchase supplies to use while traveling to, and fighting with, ISIS, including a cellphone, boots, a compass, a bag, and a flashlight, among other items. Alimehmeti also gave the UC advice on which items to purchase and on the use of different kinds of encrypted communications services, including the service that Alimehmeti stated was currently being used by fellow ISIS supporters, whom Alimehmeti referred to as “the brothers.” Alimehmeti also downloaded three encrypted communications applications on the UC’s newly purchased cellphone for use by the UC.
Further, Alimehmeti assisted the UC in traveling from Manhattan to a hotel in Queens, so the UC could purportedly meet with an individual who was preparing travel documents that the UC would use to travel to Syria to join ISIS. Alimehmeti gave the UC a piece of paper with his name and contact information, so the UC could provide that information to the purported document facilitator. Alimehmeti explained that he also wanted to travel to Syria and join ISIS, stating “I’m ready to . . . go with you man . . . you know I would. I’m done with this place.” After leaving the hotel in Queens, Alimehmeti brought the UC to JFK Airport, via public transportation, so the UC could begin the purported journey to ISIS. Within days of seeking to facilitate the UC’s travel to join ISIS, Alimehmeti indicated during a call to his brother in Albania that that he had learned of a new way to obtain a passport for his own travel (referring to the UC’s purported document facilitator), and that a “friend of mine” (referring to the UC) had “just [done] it two days ago.”
Following Alimehmeti’s arrest on the charges in this case in May 2016, the FBI executed a search of Alimehmeti’s Bronx apartment pursuant to a judicially authorized search warrant. The FBI’s search of Alimehmeti’s apartment resulted in the seizure of, among other evidence, the following: (i) a laptop computer and a cellphone belonging to Alimehmeti that contain an array of materials further demonstrating his allegiance to ISIS and terrorist ideology, including images of the ISIS flag, photographs of Alimehmeti with an ISIS flag and making gestures supportive of ISIS, images of ISIS fighters overseas, and propaganda videos promoting and glorifying ISIS, including videos depicting ISIS fighters engaging in combat and beheading prisoners; (ii) a collection of combat knives and other military-type equipment that Alimehmeti had purchased and stored at his apartment, as discussed above; and (iii) an ISIS flag that was displayed on a wall in the apartment.
Alimehmeti faces a maximum sentenced of 20 years in prison for attempting to provide material support or resources to a designated foreign terrorist organization, and a maximum sentence of 25 years in prison for making a false statement in an application for a U.S. passport with the intent to induce the issuance of a passport to facilitate an act of international terrorism. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge. Sentencing is scheduled for June 7, before Judge Engelmayer.
Mr. O’Callaghan and Mr. Berman praised the outstanding efforts of the FBI’s New York Joint Terrorism Task Force, which principally consists of agents from the FBI and detectives from the NYPD, and the NYPD’s Intelligence Division. Substantial assistance was also provided by the Department of Justice’s Office of International Affairs, the Albania State Police, and the Metropolitan Police Service's Counter Terrorism Command of London, United Kingdom.
Assistant U.S. Attorneys Emil J. Bove III, George D. Turner and Brendan F. Quigley of the Southern District of New York are in charge of the prosecution, with assistance from Trial Attorneys Joseph Attias and Kiersten Korczynski of the National Security Division’s Counterterrorism Section.
New York Attorney Charged with Tax FraudRead the Press Release
An indictment returned by a federal grand jury sitting in Manhattan was unsealed today, charging a New York-licensed attorney and partner at a New York law firm, with conspiring to defraud the United States, corruptly endeavoring to impede the internal revenue laws and tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Geoffrey S. Berman for the Southern District of New York.
According to the indictment, Steven M. Etkind, 57, was the head of a New York law firm’s tax, trusts and estates group and a Certified Public Accountant. The indictment alleges that Etkind performed legal work for a successful entrepreneur client, who passed away in 2008, naming Etkind as the co-executor of his $35 million estate.
The indictment further alleges that the client’s will directed the creation of charitable trusts, funded with assets from the client’s estate, for the sole purpose of donating to charitable organizations, including those aimed at assisting Jewish sponsored organizations. Etkind was allegedly named co-trustee of these trusts.
The indictment charges that Etkind and his co-conspirator set up a phony charitable organization and used it to steal more than $3.5 million from these charitable trusts – by first directing donations from the trusts to legitimate Jewish charitable organizations, then redirecting the funds to the phony charity accounts that Etkind and his co-conspirator controlled. Etkind is alleged to have used part of the money he stole to purchase a 6,300 sq. ft. home with a swimming pool, in Southampton, New York, titling it in a nominee name.
The indictment further alleges that to conceal his theft, Etkind filed, and caused to be filed, fraudulent personal, corporate and charitable trust returns with the Internal Revenue Service (IRS) and made several false and misleading statements to the IRS during the course of an audit and examination.
If convicted, Etkind faces a statutory maximum sentence of five years in prison on the conspiracy charge and each of the tax evasion charges, as well as three years in prison for obstructing the internal revenue laws. He also faces a period of supervised release, restitution and monetary penalties. An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Berman praised the outstanding efforts by special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorneys Jorge Almonte and Jack A. Morgan of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
New York Attorney Charged with Tax FraudRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Richard E. Zuckerman, Principal Deputy Assistant Attorney General of the Tax Division, and James D. Robnett, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation, New York Field Office (“IRS”), announced the arrest of STEVEN M. ETKIND, a New York-licensed attorney and partner at a New York law firm, for conspiring to defraud the United States, corruptly endeavoring to impede the internal revenue laws, and tax evasion.
According to the Indictment unsealed today in Manhattan federal court[1]:
ETKIND was the head of a New York law firm’s tax, trusts, and estates group and a Certified Public Accountant. The indictment alleges that ETKIND performed legal work for a successful entrepreneur client, who died in 2008, naming ETKIND as the co-executor of his $35 million estate.
The client’s will directed the creation of charitable trusts, funded with assets from the client’s estate, for the sole purpose of donating to charitable organizations, including those aimed at assisting Jewish sponsored organizations. ETKIND was named co-trustee of these trusts.
The indictment charges that ETKIND and his co-conspirator set up a phony charitable organization and used it to steal more than $3.5 million from these charitable trusts – by first directing donations from the trusts to legitimate Jewish charitable organizations, then redirecting the funds to the phony charity accounts that ETKIND and his co-conspirator controlled. ETKIND used part of the money he stole to purchase a 6,300-square-foot home with a swimming pool in Southampton, New York, titling it in a nominee name.
To conceal his theft, ETKIND filed, and caused to be filed, fraudulent personal, corporate and charitable trust returns with the IRS and made several false and misleading statements to the IRS during the course of an audit and examination of the phony charity.
If convicted, ETKIND, 57, faces a statutory maximum sentence of five years in prison on the conspiracy charge, five years on each of the tax evasion charges, and three years for obstructing the internal revenue laws. The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant would be determined by the judge.
Mr. Berman and Mr. Zuckerman praised the outstanding efforts by special agents of IRS Criminal Investigation.
Mr. Berman also thanked the U.S. Department of Justice’s Tax Division for their significant assistance in the investigation.
The case is being handled by the Office’s Complex Frauds Unit. Special Assistant United States Attorneys Jorge Almonte and Jack A. Morgan (of the Tax Division) are in charge of the prosecution.
The charges contained in the Indictment are merely accusations and the defendant is presumed innocent unless and until proven guilty.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the descriptions of the Indictment constitute only allegations, and every fact described should be treated as an allegation.
New Orleans Resident Pleads Guilty to Possessing Child PornographyRead the Press Release
U.S. Attorney Duane A. Evans announced that DAMIAN BARBARITO ROMERO, age 37, from New Orleans, Louisiana, pleaded guilty as charged today before United States District Judge Sarah S. Vance to a one-count Indictment charging him with possession of child pornography involving children under the age of twelve, in violation of Title 18, United States Code, Section 2252(a)(4)(B).
According to court documents, special agents with the Federal Bureau of Investigation executed a search warrant at ROMERO’S residence in February 2017. During the execution of the warrant, agents seized dozens of electronic devices, including laptop computers, “thumb” drives, external storage devices, and DVDs, that contained images and videos depicting the sexual victimization of children. A subsequent forensic review revealed that ROMERO had downloaded and saved approximately 3,984 unique images and 1,258 videos depicting the sexual victimization of children, including children as young as two (2) years old being forced to engaged in violent sexually explicit conduct. The forensic review also determined that ROMERO attempted unsuccessfully to encrypt and hide his collection by using a sophisticated twenty-two character password.
ROMERO faces a maximum term of imprisonment of twenty years, and he may also be required to register as sex offender. Sentencing in this matter will occur before Judge Vance on May 16, 2018, at 9:30 am.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys= Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
U.S. Attorney Evans praised the work of the Federal Bureau of Investigation. Assistant United States Attorney Jordan Ginsberg is in charge of the prosecution.
New Haven Man Sentenced to Prison for Distributing HeroinRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that JOSE MEDINA, also known as “Tito,” 48, of New Haven, was sentenced today by U.S. District Judge Jeffrey A. Meyer in New Haven to 18 months of imprisonment, followed by three years of supervised release, for his role in a heroin trafficking ring.
According to court documents and statements made in court, the DEA’s New Haven Tactical Diversion Squad targeted a New Haven-based heroin trafficking organization led by Bienvenido and Antonio Gonzalez. The investigation, which included court-authorized wiretaps, controlled purchases of narcotics and physical and video surveillance, revealed that the Gonzalez brothers regularly purchased bulk quantities of heroin from suppliers located in the Bronx, New York, and sold the heroin through a network of redistributors, including MEDINA, in New Haven and elsewhere.
The investigation resulted in federal charges against 24 individuals.
On October 18, 2017, MEDINA pleaded guilty to one count of conspiracy to possess with intent to distribute, and distribution of, 100 grams or more of heroin.
Judge Meyer ordered MEDINA, who is released on bond, to report to prison on March 23, 2018.
Bienvenido Gonzalez and Antonio Gonzalez have pleaded guilty to related charges and await sentencing.
The DEA’s New Haven Tactical Diversion Squad includes officers from the Bristol, Hamden, Milford, Monroe, New Haven, Shelton, Wallingford and Wilton Police Departments. The New Haven, East Haven and West Haven Police Departments, together with the U.S. Coast Guard, provided valuable assistance to the investigation.
This case is being prosecuted by Assistant U.S. Attorneys Natasha M. Freismuth and Patrick F. Caruso.
Nevada Doctor Arrested on Federal Charges of Illegally Selling Narcotic Prescriptions for Cash at High Desert ClinicRead the Press Release
LOS ANGELES – A medical doctor was arrested this morning on federal charges of illegally selling prescriptions without a legitimate medical purpose to undercover operatives who visited the physician’s Victorville medical office.
Wendell Mark Street, 66, of Las Vegas, was arrested this morning without incident at his residence by special agents with the Drug Enforcement Administration.
Today’s arrest is the result of a 10-count indictment returned by a federal grand jury on February 9. The indictment charges Street with five counts of illegally distributing the painkiller oxycodone and five counts of illegally distributing the tranquilizer alprazolam (often sold under the brand name Xanax). Street allegedly issued the prescriptions in 2013 in exchange for cash “while acting and intending to act outside the usual course of professional practice and without a legitimate medical purpose.”
Street allegedly wrote prescriptions without performing any physical examinations in exchange for $200 to $300 in cash from each of two undercover investigators with the California Medical Board and an informant.
Street is expected to make his initial appearance this afternoon in United States District Court in Las Vegas.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty in court.
The five counts related to illegal distribution of oxycodone each carry a statutory maximum penalty of 20 years in federal prison. The five counts related to alprazolam each carry a sentence of up to five years in prison.
During the investigation into Street, investigators executed a search warrant at his Victorville office in 2014. Street surrendered his California medical license in 2016.
This case is being prosecuted by Assistant United States Attorney Victoria A. Degtyareva of the Organized Crime Drug Enforcement Task Force.
Naperville Man Convicted of Violently Forcing Women into ProstitutionRead the Press Release
CHICAGO — A federal jury today convicted a Naperville man on sex trafficking charges for violently forcing women to engage in prostitution between 2007 and 2016.
BENJAMIN BIANCOFIORI, 38, used the promise of financial security to entice women into performing commercial sex acts on his behalf. Biancofiori often beat and punched the women, and he kept almost all of the proceeds they earned through prostitution. On one occasion, Biancofiori arranged for a victim to be returned to him at gunpoint after she tried to run away. He ran his sex-trafficking operation primarily out of his residences in the western suburbs of Chicago.
The jury convicted Biancofiori on 14 of the 15 counts against him, including conspiracy to engage in sex trafficking by force, threats of force, fraud, or coercion; engaging in sex trafficking by force, threats of force, fraud, or coercion; and obstructing, attempting to obstruct, or interfering with the enforcement of the sex trafficking statute.
Biancofiori has remained in federal custody since his arrest in May 2016. The conviction carries a minimum sentence of 15 years in prison and a maximum sentence of life in prison. U.S. District Judge Harry D. Leinenweber set sentencing for May 30, 2018, at 9:45 a.m.
The conviction was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Jeffrey S. Sallet, Special Agent in Charge of the Chicago office of the FBI; and Gabriel L. Grchan, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago. Substantial assistance was provided by the U.S. Attorney’s Office for the District of Colorado, the Denver office of the FBI, the Carol Stream Police Department and the Naperville Police Department. The government is represented by Assistant U.S. Attorneys Abigail Peluso and Erika Csicsila.
According to evidence at trial, Biancofiori lied to his victims to entice them to work for him and posted their information in commercial sex advertisements online, including the websites Backpage.com and Craigslist.com. Biancofiori also recruited multiple victims through social media. He arranged for the women to travel to meet clients at various locations throughout the United States, including in the Chicago area.
Five of the victims testified at trial about their ordeals.
Two co-defendants of Biancofiori pleaded guilty prior to trial. MARCUS WILLIS, 39, of Wheaton, and NATHAN PEREZ, 32, of West Chicago, admitted in written plea agreements that they conspired with Biancofiori to engage in sex trafficking. Judge Leinenweber will set sentencing hearings for Willis and Perez at a later date.