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15 February 2018
Windsor Man Charged with Theft of Government Property and Aggravated Identity Theft in Connection with VA Grant FraudRead the Press Release
OAKLAND – William Michael Andrews made an initial appearance in federal court this morning after a federal grand jury indicted him with theft of government property and aggravated identity theft, announced Acting United States Attorney Alex G. Tse and Department of Veterans Affairs (VA) Office of Inspector General Special Agent in Charge James Wahleithner.
According to the indictment, Andrews, 50, of Windsor, California, is alleged to have used his position as a case-worker at an East Bay non-profit agency to acquire the personal information of homeless veterans to pay his personal expenses. The indictment alleges Andrews used the veterans’ personal information, including their social security numbers, to illegally direct VA grant money to his landlord to pay his own rent, rather than its intended purpose of paying for short-term rental apartments for homeless veterans. In total, Andrews allegedly stole more than $26,000 in VA grant funds. Andrews was charged in the indictment with one count of theft of government property, in violation of 18 U.S.C. § 641, and one count of aggravated identity theft, in violation of 18 U.S.C. § 1028A.
Andrews was arrested in San Francisco and made his initial appearance this morning in federal court before Kandis A. Westmore, U.S. Magistrate Judge, in Oakland. Andrews was released on an unsecured $50,000 bond. Andrews’ next scheduled appearance is at 10:30 AM on March 14, 2018, for an appearance before the Honorable James Donato, U.S. District Judge.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendant faces a maximum statutory sentence of ten years in prison, plus a fine and restitution for the violation of 18 U.S.C. § 641. In addition, the defendant faces a mandatory minimum of two years in prison to be served consecutive to any other prison term imposed as well as a maximum $250,000 if convicted of the 18 U.S.C. § 1028A violation. However, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Ross Weingarten is prosecuting the case. The prosecution is the result of an investigation by the VA Office of Inspector General, Criminal Investigations Division.
Wilkes-Barre Man Sentenced to Twelve Years in Prison for Possession with Intent to Distribute CocaineRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Jahkel Lamar, age 37, of Wilkes-Barre, Pennsylvania, was sentenced on February 14, 2018, by U.S. District Court Judge Malachy E. Mannion to serve 12 years’ imprisonment and four years of supervised release for possession with intent to distribute crack cocaine.
According to United States Attorney David J. Freed, Lamar was indicted in September 2016, and previously pleaded guilty before Judge Mannion in April 2017. On September 1, 2016, Lamar was arrested at a bus terminal on Lackawanna Avenue in Scranton, and found in possession of approximately 127 grams of crack cocaine which Lamar intended to distribute. At the time of his arrest, Lamar had just returned to Scranton by bus from New York City.
The investigation was conducted by the Drug Enforcement Administration (DEA) and the Scranton Police Department, Special Investigations Division. Assistant United States Attorney Robert J. O’Hara prosecuted the 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.
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West Virginia Man Pleads Guilty to Fraud ChargesRead the Press Release
BOSTON – A Beckley, W.Va., man pleaded guilty today in federal court in Boston in connection with a scheme where he purported to sell paintings stolen from the Isabella Stewart Gardner Museum in 1990, on Craigslist.
Todd Andrew Desper, a/k/a “Mordokwan,” 48, pleaded guilty to four counts of wire fraud and attempted wire fraud. U.S. District Court Judge Rya W. Zobel scheduled sentencing for May 15, 2018. In May 2017, Desper was arrested in West Virginia and charged in a criminal complaint.
Desper, acting under the pseudonym “Mordokwan,” solicited foreign buyers for both the Storm on the Sea of Galilee and Vermeer’s The Concert on Craigslist in a number of foreign cities including Venice and London. Desper directed interested buyers to create an encrypted email account to communicate with him. Authorities were notified of the foreign Craigslist notices by individuals seeking to assist in the recovery of the artwork, as well as those seeking the multi-million dollar reward offered by the Museum.
At the direction of federal authorities, the security director for the Gardner Museum engaged in encrypted communications with Desper in an attempt to determine whether Desper had access to the stolen masterpieces. Desper instructed the security director to send a cashier’s check for $5 million to a location in West Virginia and that the Storm on the Sea of Galilee would then be sent in return, concealed behind another painting. The investigation ultimately revealed that Desper had no access to, nor information about, the stolen paintings, but was instead engaged in a multi-million dollar fraud scheme targeting foreign art buyers.
On March 18, 1990, 13 pieces of artwork were stolen from the Isabella Stewart Gardner Museum in the early morning hours. According to security guards, two white males dressed in Boston Police uniforms gained entrance to the Gardner Museum by stating that they were responding to a report of a disturbance within the museum compound. Upon entry, the thieves subdued and secured the guards and went on to commit the largest art theft in history, taking 13 works of art including Rembrandt’s Storm on the Sea of Galilee and Vermeer’s The Concert. The combined value of the art stolen during the Gardner theft is estimated at $500 million, although several of the works are considered priceless within the art community.
The charging statute provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling and Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. Assistance was provided the Isabella Stewart Gardner Museum, the U.S. Attorney’s Office for the Southern District of West Virginia, the FBI Pittsburgh Field Division, and the Beckley Police Department. The case is being prosecuted by Assistant U.S. Attorney Sara Miron Bloom of the U.S. Attorney’s Office Criminal Division.
Utah Resident Pleads Guilty to Devising Scheme to Obtain Construction Contracts Set Aside for Service-Disabled Veteran-Owned BusinessesRead the Press Release
SALT LAKE CITY – A Utah man pleaded guilty to wire fraud and money laundering in federal court Tuesday afternoon for his role in a fraud scheme he devised to obtain government construction contracts set aside for Service-Disabled Veteran-Owned Businesses.
Stanley Raass, age 44, of Lehi, Utah, was charged in a Felony Information filed Jan. 27, 2018. U.S. Magistrate Judge Dustin Pead accepted the guilty pleas to the two charges and set sentencing for May 23, 2018, before U.S. District Judge Tena Campbell. The plea agreement includes a stipulated sentence of 24 months which is subject to the approval of the court. He also agreed to a money judgment of $640,000.
The United States government sets aside contract benefits for qualifying individuals and companies considered Service-Disabled Veteran-Owned Small Businesses (SDVOSB). Eligibility requirements include qualification as a small business, more than 50 percent owned by a service-disabled veteran, and daily operations of the business must be managed and controlled by the service-disabled veteran.
Contractors obtaining a SDVOSB contract must self-certify annually that the contractor meets the requirements of the status-based business classification.
As a part of his plea agreement, Raass admitted that in August 2013 he devised a scheme to obtain a construction contract set aside for Service-Disabled Veteran-Owned Businesses. He falsely certified under oath that the firm that would perform the work on the contract met the requirements of the status-based classification, when in fact, he knew it did not.
According to the Felony Information, Raass owned and operated a construction company called Raass Brothers, Inc. During its existence, the company provided general construction for the federal government on construction contracts. The defendant controlled the daily operations of the business.
Raass formed another company called RWT, LLC in 2009. The business name corresponded to the initials of the defendant’s father-in-law. The defendant listed his father-in-law as the president and 51 percent owner. The defendant listed himself as the vice president and 49 percent owner.
At the time the defendant formed RWT, his father-in-law was a veteran with a 100 percent disability rating from the Department of Veterans Affairs. According to the Felony Information, the veteran was physically incapable of managing RWT. In actuality, Raass controlled the managerial and daily business operations of RWT. The defendant never served in the United States military.
Raass registered the company as an SDVOSB. Between Sept. 19, 2009 and Aug. 26, 2013, Raass, through RWT, obtained 11 contracts set aside for service-disabled veteran-owned small businesses totaling $16,517,912 in payments from the government. On multiple occasions, according to the Felony Information, the defendant certified RWT as meeting the requirements of the contracts, when he knew the business did not meet those requirements.
The defendant’s other business (RBI) primarily performed the work on the contracts, and the defendant instructed employees to withhold information about the veteran from the government, according to the charging document.
The case is being investigated by the Defense Criminal Investigative Service, the U.S. Department of Veterans Affairs Office of Inspector General, the U.S. General Services Administration Office of Inspector General, the FBI, the Naval Criminal Investigative Service, the Small Business Administration Office of Inspector General, the U.S. Army Criminal Investigation Command, and IRS Criminal Investigation.
"Service-disabled veterans are recognized for their sacrifices and are afforded some special consideration when conducting business with the U.S. Government" said Special Agent in Charge Michael Mentavlos, Defense Criminal Investigative Service Southwest Field Office. "The resolution of this case shows that those who fraudulently claim affiliation with service-disabled veterans, for their personal gain, undermine the program, and will be pursued by the Defense Criminal Investigative Service and our partner agencies."
"Fraudsters like Raass who falsely claim set-aside status steal taxpayer dollars meant for service-disabled veteran-owned small businesses. We will continue to work with our law enforcement partners to identify and prosecute such scams," said Carol F. Ochoa, Inspector General for U.S. General Services Administration
"The Service-Disabled Veteran-Owned Small Business procurement program is to help and honor our veterans, not steal from them," said Las Vegas Field Office Special Agent in Charge Tara Sullivan. "Stanley Raass created an elaborate scheme with no purpose other than defrauding the government and other disabled veterans for his own personal gain. IRS Criminal Investigation is proud to assist its other law enforcement partners with our unique skills in following the money."
“Our nation’s veterans are the ultimate victims when individuals scheme to fraudulently obtain access to federal contracting opportunities set-aside for deserving small businesses owned and operated by service-disabled veterans,” said Special Agent in Charge Kari A. Overson, U.S. Small Business Administration, Office of Inspector General.
"Individuals who devise schemes and use businesses to defraud VA of funds will be aggressively pursued by the VA Office of Inspector General, Criminal Investigations Division and held accountable to the full extent of law," said A.E. Pleasant, Special Agent in Charge of the U.S. Department of Veterans Affairs Office of Inspector General.
U.S. Attorney’s Office collects nearly $15 million in civil, criminal, asset forfeiture actions in FY2017Read the Press Release
SHREVEPORT/LAFAYETTE/ALEXANDRIA/LAKE CHARLES/MONROE, La.: United States Attorney Alexander C. Van Hook announced today that the U.S. Attorney’s Office for the Western District of Louisiana collected $14,869,623 through civil, criminal and asset forfeiture actions in fiscal year 2017. Generally, the money collected is used to restore funds to crime victims and to recover money owed to the United States.
The District collected more than $13 million in criminal actions and $1.2 million in civil actions. The U.S. Attorney’s Office also worked with its law enforcement partners to collect almost $60,000 in asset forfeiture actions in fiscal year 2017.
Included in the FY2017 criminal collections is $9.5 million collected from Wood Group PSN Inc. and $1.2 million collected from Omega Protein Inc. Wood Group previously pleaded guilty to violations of the Clean Water Act, as well as one count of falsifying documents, and was sentenced to pay more than $9 million in criminal fines and restitution. Omega Protein also pleaded guilty to Clean Water Act violations and was sentenced to pay a criminal fine of $1 million plus $200,000 restitution.
The total amount collected by the District in FY2017 included almost $1 million collected in garnishment proceedings commenced by the District’s Financial Litigation Unit (FLU). The money collected is attributable to aggressive asset investigations and garnishment of various financial interests of debtors including retirement and other investment accounts, pensions and annuities, life insurance policies, bank accounts and wages. The FLU also placed an emphasis on increasing its garnishment of assets held in the name of nominee business entities.
The U.S. Attorneys’ Offices, along with the Department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the Department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
Overall, the Justice Department collected more than $15 billion in civil and criminal actions in the fiscal year ending September 30, 2017.
“It takes long hours and great effort from our attorneys and support staff to track down and collect these funds,” stated U.S. Attorney Alexander C. Van Hook. “The money is often owed by defendants who resist repaying victims of crime. I am thankful for our dedicated employees who, for another year, brought in a record amount in collections on behalf of crime victims and taxpayers.”
U.S. Attorney for the Eastern District of Pennsylvania Announces Opioid Law Enforcement Task ForceRead the Press Release
The U.S. Attorney’s Office for the Eastern District of Pennsylvania has formed an Opioid Law Enforcement Task Force to combat the serious opioid, heroin, and fentanyl crisis. The Task Force includes federal, state, and local, law enforcement officers and prosecutors, and will be managed by the Eastern District’s Opioid Coordinator. It will be responsible for developing, implementing, and coordinating a robust prosecution response to this crisis. The office has already assembled committees of experienced federal and state prosecutors to assist law enforcement with the prosecution of transnational criminal organizations that smuggle heroin and opioids into the United States, medical professionals who unlawfully prescribe or divert highly addictive opioids, cyber criminals who distribute heroin and illicit opioids through the dark net, and drug traffickers or persons who are criminally responsible for opioid overdose deaths.
“This isn’t a crisis any one of us can tackle alone,” said United States Attorney Louis D. Lappen. “We have already been collaborating on these issues, but it is so critical we continue to work together in even more effective ways. This is the crisis of our time, and we need all hands on deck in an unprecedented way. As this crisis continues, it evolves and adapts. We also need to continue to evolve and adapt.”
The USAO’s Opioid Law Enforcement Task Force was created in response to the designation of the opioid epidemic as a “national health emergency” and to directives from Attorney General Jefferson B. Sessions, who has made combating the opioid epidemic a top priority for the Department of Justice. The Eastern District of Pennsylvania has had a successful record of identifying and prosecuting pill mill doctors with distribution causing death, among numerous other charges. Last year, Attorney General Sessions formed an Opioid Fraud and Abuse Detection Unit to focus on identifying and prosecuting health care fraud related to prescription opioids.
Two Russian Nationals Sentenced to Prison for Massive Data Breach ConspiracyRead the Press Release
Two Russian nationals were sentenced yesterday to federal prison terms for their respective roles in a worldwide hacking and data breach scheme that targeted major corporate networks, compromised 160 million credit card numbers and resulted in hundreds of millions of dollars in losses – one of the largest such schemes ever prosecuted in the United States.
The sentences were announced by Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, First Assistant U.S. Attorney William E. Fitzpatrick of the District of New Jersey and Director Randolph D. Alles of the U.S. Secret Service.
Vladimir Drinkman, 37, of Syktyvkar and Moscow, Russia, was sentenced to 144 months in prison. Drinkman previously pleaded guilty before U.S. District Judge Jerome B. Simandle of the District of New Jersey to one count of conspiracy to commit unauthorized access of protected computers and one count of conspiracy to commit wire fraud in a manner affecting a financial institution. Dmitriy Smilianets, 34, of Moscow, previously pleaded guilty to conspiracy to commit wire fraud in a manner affecting a financial institution and was sentenced to 51 months and 21 days in prison. Both men pleaded guilty in September 2015 before Judge Simandle, who imposed the sentences yesterday in Camden, New Jersey federal court. In addition to the prison terms, Judge Simandle sentenced Drinkman to three years of supervised release and Smilianets to five years of supervised release.
Drinkman and Smilianets were arrested in the Netherlands on June 28, 2012. Drinkman was extradited to the District of New Jersey on Feb. 17, 2015, and Smilianets was extradited on Sept. 7, 2012.
“Drinkman and Smilianets not only stole over 160 million credit card numbers from credit card processors, banks, retailers, and other corporate victims, they also used their bounty to fuel a robust underground market for hacked information,” said Acting Assistant Attorney General Cronan. “While mega breaches like these continue to affect millions of individuals around the world, hackers and would-be hackers should know that the Department of Justice will use all available tools to identify, arrest, and prosecute anyone who attacks the networks on which businesses and their customers rely.”
“These defendants operated at the highest levels of illegal hacking and trafficking of stolen identities,” First Assistant U.S. Attorney Fitzpatrick. “They used their sophisticated computer skills to infiltrate computer networks, steal information and sell it for a profit. Perpetrators of some of the largest data breaches in history, these defendants posed a real threat to our economy, privacy and national security, and cannot be tolerated.”
“This case demonstrates the investigative capabilities of the U.S. Secret Service and the collaborative efforts of our law enforcement partners, specifically the U.S. Attorney’s Office for the District of New Jersey, and the Dutch Ministry of Security and Justice,” Special Agent in Charge McKevitt said. “The Secret Service will continue to develop innovative ways to protect the financial infrastructure of the United States and bring to justice cyber criminals who use emerging technologies to conduct business.”
According to documents filed in this case and statements made in court:
Drinkman and Smilianets admitted to their roles in a conspiracy with three co-defendants to hack into the networks of corporate victims engaged in financial transactions, retailers that received and transmitted financial data and other institutions with information that the conspirators could exploit for profit, including the computer networks of NASDAQ, 7-Eleven, Carrefour, JCP, Hannaford, Heartland, Wet Seal, Commidea, Dexia, JetBlue, Dow Jones, Euronet, Visa Jordan, Global Payment, Diners Singapore and Ingenicard.
According to the indictment in this case and statements made in court, the five defendants each played specific roles in the scheme. Drinkman and Alexandr Kalinin, 31, of St. Petersburg, Russia, allegedly specialized in penetrating network security and gaining access to the corporate victims’ systems. Drinkman and Roman Kotov, 36, of Moscow, allegedly specialized in mining the networks to steal valuable data. The hackers hid their activities using anonymous web-hosting services allegedly provided by Mikhail Rytikov, 30, of Odessa, Ukraine. Smilianets sold the information stolen by the other conspirators and distributed the proceeds of the scheme to the participants.
Drinkman and Kalinin were previously charged in New Jersey as “Hacker 2” and “Hacker 1” in a 2009 indictment charging Albert Gonzalez, 34, of Miami, Florida, in connection with five corporate data breaches – including the breach of Heartland Payment Systems Inc., which at the time was the largest ever reported. Gonzalez is currently serving 20 years in federal prison for those offenses. Kalinin is also charged in two federal indictments in the Southern District of New York: the first charges Kalinin in connection with hacking certain computer servers used by NASDAQ and the second charges him and another Russian hacker, Nikolay Nasenkov, with an international scheme to steal bank account information from U.S.-based financial institutions. Rytikov was previously charged in the Eastern District of Virginia with an unrelated scheme.
Kalinin, Kotov and Rytikov remain at large.
The Attacks
According to documents filed in this case and statements made in court, the five defendants allegedly penetrated the computer networks of corporate victims and stole user names and passwords, means of identification, credit and debit card numbers and other corresponding personal identification information of cardholders, acquiring more than 160 million card numbers through hacking.
The initial entry was often gained using a “SQL injection attack.” SQL, or Structured Query Language, is a type of programing language designed to manage data held in particular types of databases; the hackers allegedly identified vulnerabilities in SQL databases and used those vulnerabilities to infiltrate a computer network. Once the network was infiltrated, the defendants allegedly placed malicious code, or malware, in the system. This malware created a “back door,” leaving the system vulnerable and helping the defendants maintain access to the network. In some cases, the defendants lost access to the system due to companies’ security efforts, but were allegedly able to regain access through persistent attacks.
Instant message chats obtained by law enforcement revealed the defendants allegedly often targeted the victim companies for many months, waiting patiently as their efforts to bypass security were underway. The defendants had malware implanted in multiple companies’ servers for more than a year.
The defendants allegedly used their access to the networks to install “sniffers,” which were programs designed to identify, collect and steal data from the victims’ computer networks. The defendants then allegedly used an array of computers located around the world to store the stolen data and ultimately sell it to others.Selling the Data
According to documents filed in the case and statements made in court, after acquiring the card numbers and associated data – which they referred to as “dumps” – the conspirators sold it to resellers around the world. The buyers then sold the dumps through online forums or directly to individuals and organizations. Smilianets was in charge of sales, selling the data only to trusted identity theft wholesalers. He charged approximately $10 for each stolen American credit card number and associated data, approximately $50 for each European credit card number and associated data and approximately $15 for each Canadian credit card number and associated data – offering discounted pricing to bulk and repeat customers. Ultimately, the end users encoded each dump onto the magnetic strip of a blank plastic card and cashed out the value of the dump by withdrawing money from ATMs or making purchases with the cards.
Covering Their Tracks
According to documents filed in the case and statements made in court, the defendants allegedly used a number of methods to conceal the scheme. Unlike traditional Internet service providers, Rytikov allowed his clients to hack with the knowledge he would never keep records of their online activities or share information with law enforcement.
Over the course of the conspiracy, the defendants allegedly communicated through private and encrypted communications channels to avoid detection. Fearing law enforcement would intercept even those communications, some of the conspirators attempted to meet in person.
To protect against detection by the victim companies, the defendants allegedly altered the settings on victim company networks to disable security mechanisms from logging their actions. The defendants also worked to evade existing protections by security software.
As a result of the scheme, financial institutions, credit card companies and consumers suffered hundreds of millions in losses – including more than $300 million in losses reported by just three of the corporate victims – and immeasurable losses to the identity theft victims in costs associated with stolen identities and false charges. The charges and allegations contained in indictments against the remaining defendants are merely accusations and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The case was investigated by special agents of the U.S. Secret Service, Newark Field Office and Criminal Investigative Division. The case is being prosecuted by by Trial Attorneys Andrew S. Pak and Richard Green and Deputy Chief of Litigation James Silver of the Criminal Division’s Computer Crime and Intellectual Property Section, and Assistant U.S. Attorney Justin Herring of the Computer Hacking and Intellectual Property Section of the Economic Crimes Unit and the Justice Department’s Office of International Affairs. The Criminal Division’s Office of International Affairs also provided substantial assistance in this case.
Acting Assistant Attorney General John P. Cronan and U.S. Attorney Carpenito thanked public prosecutors with the Dutch Ministry of Security and Justice and the National High Tech Crime Unit of the Dutch National Police. They also credited the special agents of the U.S. Secret Service, Newark Field Office, under the direction of Special Agent in Charge Mark McKevitt, and the Criminal Investigative Division, under the direction of Special Agent in Charge Michael D’Ambrosio, for the ongoing investigation leading to yesterday’s sentencings.
Two Northern California Women Plead Guilty to Conspiracy to Fraudulently Obtain Tax RefundsRead the Press Release
SACRAMENTO, Calif. —Denna Chambers, aka Denna Rice, 35, of Fairfield, pleaded guilty today to one count of conspiring to defraud the United States, United States Attorney McGregor Scott announced. Co-defendant, Starsheka Mixon, 34, of Pinole, previously pleaded guilty to the same charge on February 8, 2018.
“The harm caused by these defendants goes beyond simply cheating the government,” said Michael T. Batdorf, Special Agent in Charge, IRS Criminal Investigation. “Stealing identities and filing false tax returns is a serious crime that has a devastating impact on the victims whose identities they stole to perpetrate this crime. CI will continue to investigate these crimes and hold those responsible fully accountable.”
According to court documents, between approximately January 2011 and June 2013, Chambers and Mixon conspired together and with others to fraudulently obtain tax refunds by filing false tax returns in the names of other people with the Internal Revenue Service. The tax returns included false statements about the taxpayers’ income, dependents, and occupations in order to obtain refunds and tax credits to which the taxpayers were not entitled, including the Earned Income Credit and the Additional Child Tax Credit. Some of the fraudulent tax returns used the name and personal information of individuals without their knowledge or consent. The fraudulently obtained refunds were typically placed on prepaid debit cards controlled by Chambers, Mixon, or their associates. In their respective plea agreements, Chambers and Mixon both admitted that in all, approximately 174 false federal income tax returns were filed seeking over $880,000 in tax refunds, of which approximately $477,348 were paid out by the IRS.
This case was the product of an investigation by IRS Criminal Investigation. Assistant United States Attorney Shelley D. Weger is prosecuting the case.
Chambers and Mixon are scheduled to be sentenced by Judge Morrison C. England, Jr. on May 24, 2018. Both Chambers and Mixon face a maximum statutory penalty of 10 years in prison, restitution, and a fine of $250,000. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
The continued effort by the IRS to combat identity theft and refund fraud has led to steep declines in tax-related identity theft. The IRS, state tax agencies, and the tax industry have started their third filing season working as the Security Summit, a private-public sector partnership formed in 2015 to combat identity theft. Summit partners have put in place multiple behind-the-scenes safeguards that are helping protect the nation’s taxpayers. Because the IRS and Summit partners have stepped up efforts to stop suspected fraudulent returns from entering tax processing systems, there continues to be a substantial decline in the number of taxpayers reporting that they are victims of identity theft. In 2017, the IRS received 242,000 reports from taxpayers compared to 401,000 in 2016 and 677,000 victim reports in 2015. Overall, the number of identity theft victims has fallen nearly 65 percent between 2015 and 2017.
These efforts go hand-in-hand with the work done by IRS Criminal Investigation, where special agents continue working to bring identity thieves to justice across the nation.
Two Men Sentenced to Federal Prison for Meth-Distribution ConspiracyRead the Press Release
Two men have been sentenced to federal prison for their roles in a methamphetamine distribution conspiracy.
Matthew Vance Query, age 34, of Mason City, Iowa, received his prison term after an August 10, 2017, guilty plea; and Ronald William Frank, age 31, of Mason City, Iowa, received his prison term after an August 28, 2017, guilty plea. Query and Frank each pled guilty to conspiracy to distribute methamphetamine.
Query and Frank admitted their involvement in a conspiracy to distribute methamphetamine in northern Iowa and Colorado between 2012 and April 7, 2017. On April 3, 2017, search warrants were executed as part of the investigation into Frank and Query, including a traffic stop, search of Query’s residence, a storage unit and a 2005 Chevrolet Malibu driven by Frank. Located in the vehicle was marijuana, and a container containing 378.9 grams of ice methamphetamine. During the search of Query’s residence, marijuana, scales, packaging materials and cash was located. Stolen property was located at Query’s residence and storage unit. Query was responsible for the distribution of more than 500 grams of actual (pure) methamphetamine. Frank was responsible for the distribution of more than 150 grams of actual (pure) methamphetamine.
Query and Frank were sentenced in Cedar Rapids by United States District Court Judge Linda R. Reade. Query was sentenced to 151 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a 5-year term of supervised release after the prison term. Frank was sentenced to 96 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a 5-year term of supervised release after the prison term. There is no parole in the federal system.
Both Query and Frank are being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Jack Lammers and investigated by the North Central Iowa Narcotics Task Force and the Cerro Gordo County Sheriff’s Office.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 17-3026. Follow us on Twitter @USAO_NDIA.
Two Arrested on Child Pornography ChargesRead the Press Release
SAN JUAN, Puerto Rico – On February 14, 2018, federal authorities arrested Ricardo Barrios-Calderon and Alfredo Santiago-Rosario charging them with child pornography related offenses, announced United States Attorney Rosa Emilia Rodríguez-Vélez. The Federal Bureau of Investigation (FBI) conducted the investigation that led to the arrests.
On February 14, 2018, a criminal complaint charged Ricardo Barrios-Calderon with production of child pornography, in violation of Title 18, United States Code, Sections 2251(a) and (e) and with possession of child pornography involving prepubescent minors, in violation of Title 18, United States Code, Sections 2252A(a)(5)(B) and (b)(2).
In an unrelated case, on February 14, 2018, a federal grand jury returned a two-count-indictment charging Alfredo Santiago-Rosario with advertising child pornography, in violation of Title 18, United States Code, Sections 2251(d)(1)(A) and (e), and with possession of child pornography, in violation of Title 18, United States Code, Section 2252A(a)(5)(B) and (b)(2).
If convicted, both defendants face a mandatory minimum term of imprisonment of 15 years and a possible maximum term of imprisonment of up to 30 years. Assistant United States Attorney Elba Gorbea is in charge of the prosecution of defendant Barrios-Calderon and Assistant United States Attorney Ginette Milanes is in charge of the prosecution of Santiago-Rosario.
The public is reminded that criminal complaints and indictments contain only charges and are not evidence of guilt. Defendants are presumed to be innocent until and unless proven guilty.
Top Executives at Long Island Mortgage Lender Plead Guilty to $8.9 Million FraudRead the Press Release
Earlier today in federal court in Central Islip, New York, Edward J. Sypher, Jr., and Matthew T. Voss, senior executives at Long Island mortgage lender Vanguard Funding, LLC (Vanguard), pleaded guilty to conspiring to commit wire and bank fraud in connection with their diversion of more than $8.9 million of warehouse loans that Vanguard had obtained to fund mortgages. The guilty pleas were entered before United States District Judge Sandra J. Feuerstein. When sentenced, each defendant faces up to 20 years in prison, as well as restitution, criminal forfeiture and a fine.
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, and Maria T. Vullo, Superintendent, New York State Department of Financial Services, announced the guilty pleas.
According to court filings and the facts presented at the plea proceedings, between August 2016 and March 2017, Voss, Vanguard’s Chief Operating Officer, and Sypher, the Chief Financial Officer, engaged in a scheme in which they obtained warehouse loans, or short-term loans, for Vanguard by falsely representing that Vanguard would use the proceeds of those loans to fund mortgages or mortgage refinancing for Vanguard’s clients. Once Vanguard received the loans, however, the defendants diverted the monies to pay personal expenses and compensation, and to pay off loans they had previously obtained with fraudulent loan submissions for improper purposes.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Whitman G.S. Knapp and Elizabeth Losey Macchiaverna are in charge of the prosecution.
The Defendants:
EDWARD J. SYPHER, JR.
Age: 41
Residence: Scarsdale, New York
E.D.N.Y. Docket No. 18-CR-028 (SJF)MATTHEW T. VOSS
Age: 42
Residence: Northport, New York
E.D.N.Y. Docket No. 18-CR-027 (SJF)Three people charged for their roles in conspiracy to recruit poor and homeless people and file fraudulent tax returns on their behalfRead the Press Release
Three people were charged in federal court for their roles in a conspiracy to recruit poor and homeless people to allow them to file fraudulent tax returns on their behalf, said U.S. Attorney Justin E. Herdman and IRS Special Agent in Charge Ryan L. Korner.
Muhammad Hague, 40, of Avon, and Richard A. Warren, 37, of Philadelphia, were each indicted on one count of conspiracy to make false claims.
Maryam Hague, 38, of Shaker Heights, was charged in a criminal information with one count of conspiracy to commit theft of public money and one count of theft of public money.
Maryam Hague operated Hague United Services, a tax preparation business she operated out of her residences in Cleveland and Shaker Heights. Her brother, Muhammad Hague, also operated a tax preparation business, Hague Financial Services, according to court documents.
Muhammad Hague recruited Natasha Johnson to work for Hague Financial in 2010, while both continued working for the Cleveland Water Department, according to the indictment.
In 2011, Maryam Hague recruited her brother to recruit people to provide their personal identification information, so Maryam Hague would prepare and file false tax returns on behalf of claimants. She eventually taught Muhammad Hague how to prepare and file the false tax returns on his own, according to court documents.
From 2011 through 2013, Muhammad Hague, Johnson and others operated Hague Financial, which held itself out as a tax preparation business. Muhammad Hague, Johnson and others sometimes conducted Hague Financial’s business out of the Cleveland Water Department during normal business hours, according to court documents.
Muhammad Hague oversaw the operation of Hague Financial Services. Hague, Johnson and others promoted Hague Financial Services through paper flyers, door-to-door solicitation, and other means. They focused their recruiting efforts on lower-income neighborhoods in Cleveland, including homeless shelters, according to court documents.
Maryam Hague recruited Warren and his wife to recruit people in the Philadelphia area who would provide their personal identification information to Maryam Hague, who would then then prepare and file false income tax returns in the claimants’ names. Maryam Hague agreed to pay a $1,000 “referral fee” for each claimant. Warren and his wife established and maintained business bank accounts for shell companies they established in order to receive their referral fees, which were paid out of claimants’ tax refunds, according to court documents.
The tax returns reported falsified occupations and amounts of income, typically through unverifiable “household help” occupations such as caregiver, lawn care and self-employed. Based on the falsified income, and sometimes based on falsified education expenses or dependents, the tax returns often fraudulently claimed a variety of tax credits, such as the Earned Income Credit, Making Work Pay Credit and American Opportunity Credit, among others, according to court documents.
Maryam Hague and her coconspirators filed approximately 786 false tax returns seeking more than $3.5 million in refunds from the IRS, according to court documents.
Prosecutors are seeking to seize Maryam Hague’s residence in Shaker Heights, according to court documents.
If convicted, the defendants’ sentences will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case was investigated by the Internal Revenue Service – Criminal Investigations. It is being prosecuted by Assistant U.S. Attorney Elliot Morrison.
An indictment or an information is only a charge and is not evidence of guilt. Each defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Three from the Akron area indicted for their roles in a conspiracy in which they forged the signatures of medical professionals to obtain thousands of Oxycodone pills and other drugsRead the Press Release
Three people from the Akron area were indicted in federal court for their roles in a conspiracy in which they forged the signatures of medical professionals to illegally obtain thousands of Oxycodone pills and other drugs, law enforcement officials said.
Dennie Rowland, 46, of Hartville, Candi A. Webb, 34, of Akron, and Richard L. Overdorf, 37, of Akron, were each indicted on one count of conspiracy to possess with intent to distribute controlled substances.
Rowland and Webb worked together in a doctor’s office, where the physician and a nurse practitioner were permitted to prescribe medicine. Rowland and Webb were not, according to the indictment.
Rowland and Webb took the prescription pads from their employers and forged the signatures of the doctor and nurse practitioner. Rowland and Webb wrote the prescriptions in the names of friends, relatives and other acquaintances without their knowledge for Oxycodone, amphetamine salts and Alprazolam, according to the indictment.
Rowland, Webb and Overdorf then presented those prescriptions to be filled at pharmacies in Akron, North Canton and elsewhere. They used the drugs themselves and sold the drugs, according to the indictment.
The conspiracy took place from December 2015 through November 2016, according to the indictment.
“These defendants illegally put thousands of doses of Oxycodone on the streets of Akron and Canton at time when pills, heroin and fentanyl were killing so many people in our community,” U.S. Attorney Justin Herdman said. “We will continue to focus on reducing the supply of opioids, whether that’s prescription painkillers being illegally diverted or fentanyl being illegally shipped to our shores.”
“Rowland and Webb were trusted employees who stole from their employers and flooded the community with highly addictive prescription drugs at a time when the community is struggling with an opioid abuse crisis. The prosecution of all involved in this investigation was imperative in our fight against diverted drugs.”
If convicted, a defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the
characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the Drug Enforcement Administration, the Akron Police Department, and the Summit County Sheriff’s Office. The matter is being prosecuted by Assistant U.S. Attorney Jason M. Katz.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Three Stockton Men Indicted for Trafficking in FirearmsRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned an indictment today against Stockton residents Arturo Napoles, 29; Raymond Morin, 31; and Raul Diaz, 23, charging them with unlawful dealing in firearms, U.S. Attorney McGregor W. Scott announced. Napoles was also charged with 19 counts of being a felon in possession of a firearm, five counts of possession of a machinegun, two counts of distribution of methamphetamine, and one count of distribution of cocaine.
U.S. Attorney McGregor W. Scott said, “The illegal manufacture and trafficking of firearms poses a serious threat to our communities. Because of this threat, the U.S. Attorney’s Office has prioritized the prosecution of these crimes, and through our partnership with the ATF and local law enforcement, we have managed to seize large amounts of contraband weapons and to bring those who inject them into the community to justice. We are committed to keeping our communities safe by continuing these partnerships and focusing on cases like the one indicted today.”
“At ATF we are committed to making all our communities a safe place,” said Special Agent in Charge Jill Snyder, San Francisco Field Division, Bureau of Alcohol, Tobacco, Firearms and Explosives. “Firearms trafficking is a dangerous activity. It results in guns ending up in the hands of criminals and gang members who engage in criminal activity regardless of whether that endangers lives. It only takes one round from one gun to end a life. Our efforts to combat gun related crime has spanned across the district. From 2016 to 2018, ATF agents seized 1,890 firearms within Stockton, Fresno and Sacramento areas. That is 1,890 that were involved in criminal activity and are now off the streets of our community.”
Stockton Police Chief Eric Jones stated: “The results of this investigation made Stockton a safer community. I’m committed to these types of operations and investigations with our Federal law enforcement partners because getting gang members, violent criminals, weapons, and narcotics off our streets is an on-going process to make Stockton the best it can be.”
According to court documents, between April 27, 2017, and February 1, 2018, Napoles allegedly sold approximately 50 firearms, including machine guns, stolen firearms, firearms with obliterated serial numbers, and assault rifles manufactured from unfinished lower receivers with no serial numbers. At the time of his arrest, he possessed one handgun, eight machineguns, and five machine gun-conversion devices. Napoles is prohibited from possessing firearms and is not licensed to deal in firearms.
Between April 27, 2017, and November 29, 2017, Diaz allegedly manufactured and sold approximately 15 assault rifles. He manufactured the firearms in his garage from unfinished lower receivers. Diaz is not licensed to manufacture and deal in firearms.
Between June 1, 2017, and January 4, 2018, Morin allegedly sold eight firearms, including five assault rifles manufactured from unfinished lower receivers with no serial numbers. Morin is not licensed to deal in firearms.
This case is the product of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Stockton Police Department. Assistant U.S. Attorney Cameron L. Desmond is prosecuting the case.
If convicted, Napoles faces a maximum statutory penalty of life in prison and a $10 million fine. If convicted, Morin and Diaz face a maximum statutory penalty of five years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
The following are summaries of some of the recent cases brought by the U.S. Attorney’s Office involving the illegal sale of firearms:
On January 25, 2018, a grand jury indicted James Bowen with engaging in the business of dealing firearms without a license, possession of an unregistered firearm, and being a felon in possession of a firearm. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt. 1:18-CR-0015-DAD
On December 12, 2017, Sharrod Gibbons was sentenced to over two years in prison for unlawful dealing in firearms. 2:15-CR-00158-JAM
On September 20, 2017, Jason Prom was sentenced to twelve years in prison for conspiring to deal firearms without a license, dealing firearms without a license, and being a felon in possession of a firearm. 2:16-CR-134-KJM
On September 8, 2017, Joseph Latu was sentenced to nine years in prison for unlawful dealing in firearms. 2:15-CR-00209-GEB
On September 7, 2017, Christopher Gonzales, Jake Phillip Jines, and Samuel Elijahsidney Scott were indicted for dealing firearms without a license. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt. 2:17-CR-162-TLN.
On July 14, 2017, Charles Tucker was sentenced to five years in prison for unlawful dealing in firearms. 2:15-CR-00209-GEB
On May 25, 2017, a grand jury indicted Robert Guthrie, Prado Andres Corona, Marcos Hernandez, Joseph Quirarte and Orasio Fierro for conspiracy to engage in the business of dealing firearms without a license and other charges. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt. 1:17-CR-00135-LJO
On March 28, 2017, Alphonso Harris was sentenced to ten months in prison for unlawful dealing in firearms. 2:16-CR-00011-JAM
On December 9, 2016, Emiliano Cortez-Garcia, was sentenced to six years in prison for unlawful dealing in firearms, possession of a machinegun, and possession of an unregistered firearm. 2:13-CR-00353-GEB
On August 24, 2016, Felix Saldivar was sentenced to over four years in prison for unlawful dealing in firearms. 2:16-CR-00109-KJM
On May 2, 2016, Gerardo Barraza was sentenced to almost two years in prison for unlawful dealing in firearms. 2:14-CR-00040-WBS
On March 10, 2016, James Malcolm was sentenced to five years in prison for unlawful possession of a toxin, unlawful dealing in firearms, possession of a machinegun. 2:14-CR-00158-TLN
On February 17, 2016, Daniel aka “Dr. Death” Crowninshield was sentenced to nearly three and a half years in prison for unlawful dealing in firearms and possession of an unregistered machinegun. 2:14-CR-00164-TLN
On February 17, 2016, Brandon Johnson was sentenced to ten years in prison for selling firearms without a license and distributing methamphetamine. 2:13-CR-036- KJM
This case was brought as part of Project Safe Neighborhoods (PSN), an initiative that brings together federal, state and local law enforcement to combat gun and gang crime. At the core of PSN is increased federal prosecution to incapacitate chronic violent offenders as well as to communicate a credible deterrent threat to potential gun offenders.
Three MS-13 Gang Members Sentenced to Lengthy Sentences in Brooklyn Federal Court for Murder of 19-Year Old ManRead the Press Release
Earlier today, in federal court in Brooklyn, defendants Milton Contreras, Oscar Welman Espinoza-Merino and Jose Osmin Rubio were each sentenced by United States District Judge Margo K. Brodie following their convictions for the murder of a 19-year-old victim on Long Island in 2014. Contreras was sentenced to 27 years’ imprisonment, while Espinoza-Merino and Osmin Rubio were each sentenced to more than 24 years’ imprisonment. After serving their sentences, all three defendants will face deportation from the United States.
Richard P. Donoghue, United States Attorney for the Eastern District of New York; Angel M. Melendez, Special Agent-in-Charge, United States Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI) New York; Ashan M. Benedict, Special Agent-in-Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives, New York Field Division (ATF); and James P. O’Neill, Commissioner, New York City Police Department, announced the sentencings. Mr. Donoghue also expressed his appreciation to the Suffolk County Police Department for their assistance during the investigation.
“Today’s sentence marks the final chapter in the pursuit of justice against these three MS-13 gang members who brutally murdered a teenager execution-style when they suspected him of cooperating with law enforcement,” stated United States Attorney Donoghue. “This prosecution is part of the ongoing mission of this Office to protect the residents of this district from the violence and lawlessness of MS-13, and we will not rest until the MS-13 criminal organization is entirely dismantled.”
“It is not a secret that MS-13 gang members are violent for the sake of being violent, and in this particular case exhibited their murderous ways by executing a teenager in Long Island,” stated HSI Special Agent-in-Charge Melendez. “As they use violence to seek power through instilling fear into the neighborhoods in which they live, we will be relentless working with our partners to dismantle this vicious gang and bring peace back to the communities.”
“The individuals that committed this heinous act of violence are rightfully where they belong. While in prison, they can reflect on the terror and pain they inflicted on their community. Gangs like MS-13 that seek to terrorize the community putting citizens at fear for their lives should know that law enforcement is committed to rooting this evil from our society and making the streets safe for everyone,” stated ATF Special Agent-in-Charge Benedict. “I would like to express my gratitude to the United States Attorney for prosecuting the case. I also would like to thank the Special Agents and Task Force Officers of the ATF’s Joint Firearms Task Force and our counterparts at HSI and the NYPD for diligently pursuing this case until justice was served.”
As detailed in the superseding indictment, the three defendants—along with a fourth defendant convicted of the murder, Byron Lopez, who has not yet been sentenced—are members of the Jamaica, Queens and/or Brentwood, Long Island chapters of the violent street gang La Mara Salvatrucha, also known as “MS-13.” On February 25, 2014, Lopez, Espinoza-Merino, Contreras and Rubio directed the victim, fellow gang member Sidney Valverde, to travel to Long Island under the false pretense that they needed him to assist in gang business there. In fact, the co-conspirators planned to kill Valverde because they believed that he was providing information about the gang’s activities to law enforcement. After Valverde arrived in Long Island, the co-conspirators shot him in the back of the head and left his body on Miller Place Beach in Suffolk County where it was discovered by a beachcomber approximately two weeks later.
This case is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York targeting members of the MS-13, a violent international criminal organization. The MS-13’s leadership is based in El Salvador and Honduras, but the gang has thousands of members across the United States. With numerous branches, or “cliques,” the MS-13 is the largest and most violent street gang on Long Island. Since 2003, hundreds of MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in this district. A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders, and assaults. Since 2010 alone, this Office has obtained indictments charging MS-13 members with carrying out more than 40 murders in the Eastern District of New York and has convicted dozens of MS-13 leaders and members in connection with those murders.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorney Alixandra Smith is in charge of the prosecution.
Defendants Sentenced Today: OSCAR WELMAN ESPINOZA-MERINO (aka “Speedy” and “Petey”)
Age: 35
Brentwood, New YorkMILTON CONTRERAS (aka “Diabolico”)
Age: 22
Brentwood, New YorkJOSE OSMIN RUBIO (aka “Slow”)
Age: 30
Brentwood, New YorkDefendant Awaiting Sentencing: BYRON LOPEZ
Age: 26
Queens, New YorkE.D.N.Y. Docket No. 14-463 (MKB) (RER)
Texas Woman Pleads Guilty to Federal Cocaine Trafficking Charges in New MexicoRead the Press Release
ALBUQUERQUE – Candy May Gonzales, 33, of Canutillo, Texas pled guilty yesterday afternoon in federal court in Las Cruces, N.M., to cocaine trafficking charges arising from the seizure of 4.06 kilograms (8.95 pounds) of cocaine at the U.S. Border Patrol Checkpoint near Las Cruces.
The DEA arrested Gonzales and co-defendant Carlos Ivan Todd, 30, also of Canutillo, Texas, in Oct. 2017, on a criminal complaint charging them with possession of 4.0 kilograms of cocaine with intent to distribute in Dona Ana County, N.M. According to the complaint, U.S. Border Patrol agents arrested Todd and Gonzales at the U.S. Border Patrol Checkpoint on I-25 near Las Cruces after the agents seized three bundles of cocaine concealed in the vehicle in which Todd and Gonzales were traveling.
Gonzales subsequently was indicted and was charged with participating in a cocaine trafficking conspiracy from Aug. 2017 through Oct. 8, 2017, and possessing cocaine with intent to distribute on Oct. 8, 2017. According to the indictment, Gonzales committed the offenses in Dona Ana County.
During yesterday’s proceedings, Gonzales pled guilty to the indictment without the benefit of a plea agreement. At sentencing, Gonzales faces a mandatory minimum penalty of five years and a maximum of 40 years of imprisonment. Gonzales remains in custody pending a sentencing hearing, which has yet to be scheduled.
On Jan. 4, 2018, Todd pled guilty to a felony information charging him with conspiracy and possession of cocaine with intent to distribute. In entering the guilty plea, Todd admitted that on Oct. 8, 2017, he drove a vehicle containing 4.06 kilograms of cocaine hidden in a compartment in the vehicle into the U.S. Border Patrol Checkpoint on I-25 north of Las Cruces. Todd admitted that he previously agreed with others to drive the cocaine from El Paso, Texas, to Albuquerque, N.M., where the drugs would be distributed further. At sentencing, Todd faces a statutory mandatory minimum penalty of five years and a maximum of 40 years in prison. He remains in custody pending a sentencing hearing, which has yet to be scheduled.
This case was investigated by the Las Cruces office of the DEA and the U.S. Border Patrol. Assistant U.S. Attorney John Balla of the U.S. Attorney’s Las Cruces Branch Office is prosecuting the case.
Texas Man Sentenced to Prison for His Role in Stealing Funds Intended to Feed Hungry ChildrenRead the Press Release
LITTLE ROCK—Cody Hiland, United States Attorney for the Eastern District of Arkansas, announced today that United States District Court Judge Kristine G. Baker sentenced Waymon Weeams, 37, of Rockwall, Texas, to federal prison for his role in a widespread scheme to steal money intended for feeding children in low income areas in Arkansas.
Judge Baker sentenced Weeams, who pleaded guilty to conspiring to commit wire fraud on October 4, 2016, to 15 months’ imprisonment, to be followed by two years of supervised release. He was also ordered to pay $697,236.41 in restitution.
The United States Department of Agriculture (USDA) feeding programs in Arkansas are administered through the Arkansas Department of Human Services (DHS). Sponsors who want to participate in the feeding programs must submit an application to DHS for approval. After they are approved, they can provide meals as part of the feeding programs and they are reimbursed for the eligible meals they serve.
Weeams was a sponsor for a feeding program through an organization called “SJ&B Outreach.” Weeams had three approved feeding site locations, which were located in Wynne, Forrest City, and Marianna. Between all three sites, he claimed as many as 872 children were fed each day. No children were ever actually fed at the Forrest City site, and Weeams now says that approximately 10 to 50 children were fed at the other two sites. Weeams was recruited to participate in the scheme by Anthony Waits. Waits’s wife, Gladys Waits, worked for DHS and approved Weeams’s application. Weeams paid Anthony Waits approximately 40% of the $697,236.41 Weeams received in the scheme.
Weeams is the 15th defendant sentenced who was charged in connection with a scheme to fraudulently obtain USDA program funds intended to feed children in low income areas. Other defendants include: Kattie Jordan (63 months imprisonment on March 15, 2016); Reuben Nims (21 months imprisonment on November 2, 2016); Tonique Hatton (108 months’ imprisonment on January 4, 2017); James Franklin (24 months’ imprisonment on January 10, 2017); Maria Nelson, (30 months’ imprisonment on January 31, 2017); Michael Lee (30 months’ imprisonment on May 1, 2017); Christopher Nichols (3 years’ probation on May 16, 2017); Gladys Waits (108 months’ imprisonment on July 17, 2017); Alexis Young (18 months’ imprisonment on August 18, 2017); Erica Warren (18 months’ imprisonment on August 18, 2017); Francine Leon (34 months imprisonment on September 21, 2017); Anthony Waits (175 months’ imprisonment on October 20, 2017); Jacqueline Mills (150 months imprisonment on December 6, 2017); and Dorothy Harper (33 months imprisonment on January 9, 2018).
Debora Washington was indicted on conspiracy and fraud charges related to this scheme on February 1, 2018, and she is scheduled to be arraigned on these charges next week. Her case will be handled by United States District Judge J. Leon Holmes. Also, Elbert Harris pleaded guilty to wire fraud, and Nigel Hall has pleaded guilty to conspiracy to commit wire fraud in relation to the same feeding programs. Both are awaiting sentencing.
The investigation is still ongoing and continues to be conducted by the USDA–Office of Inspector General, IRS–Criminal Investigations, and the FBI. The case is being prosecuted by Assistant United States Attorneys Jana Harris, Allison W. Bragg, and Cameron McCree.
If you are aware of any fraudulent activity regarding feeding programs, please email that information to [email protected].
Texas Man Pleads Guilty to Conspiracy Involving Cocaine, Marijuana, Heroin and MethamphetamineRead the Press Release
Gulfport, MS – Jose Luis Chavez a/k/a "Big Head," 47, of Edinburg, Texas, pled guilty today before U.S. District U.S. District Judge Sul Ozerden to conspiracy to possess with intent to distribute 500 grams or more of cocaine, 50 grams or more of actual methamphetamine, 100 kilograms or more of marijuana, and 100 grams or more of heroin, announced U.S. Attorney Mike Hurst and DEA Special Agent in Charge Stephen G. Azzam.
During an arrest in Gulfport, Mississippi, in March 2016, agents with DEA began an investigation that led to the arrest of Chavez. Confidential sources met with law enforcement and stated that Chavez was a major source of supply for cocaine, marijuana, methamphetamine and heroin for the Mississippi Gulf Coast. The confidential sources stated Chavez conspired with at least three other individuals to traffic narcotics from Texas to Mississippi. Agents with DEA corroborated the information provided by the confidential sources and arrested Chavez in Texas and brought him to Mississippi for prosecution.
Chavez will be sentenced on May 17, 2018, by Judge Ozerden, and faces a maximum penalty of life in prison and a $10 million fine.
The case was investigated by the DEA and the FBI Safe Streets Task Force. It was prosecuted by Assistant U.S. Attorney Kathlyn R. Van Buskirk.
Tampa Real Estate Agent Indicted for Bankruptcy FraudRead the Press Release
Tampa, Florida – United States Attorney Maria Chapa Lopez announces the unsealing of an indictment charging David Lyle Morgan (53, Tampa) with two counts of bankruptcy fraud and one count of falsification of records in a bankruptcy proceeding. If convicted, he faces a maximum penalty of 30 years in federal prison.
According to the indictment, Morgan, a licensed realtor, entered into a contract with a homeowner to sell a property in foreclosure. In order to prevent the Federal National Mortgage Association (“Fannie Mae”) from lawfully foreclosing on the homeowner’s property, Morgan engaged in a bankruptcy fraud scheme whereby he filed fraudulent bankruptcy petitions in the homeowner’s name, without the homeowner’s knowledge or consent, just prior to the scheduled foreclosure sale dates. These fraudulent bankruptcies invoked the automatic stay provision of the bankruptcy code and prevented Fannie Mae from conducting the sale and obtaining title to the property. They also allowed Morgan to continue his efforts to sell the property to obtain illegal real estate commissions.
The indictment further alleges that Morgan made false declarations on a fraudulent bankruptcy petition that he had filed in the name of the homeowner, impeding the proper administration of a bankruptcy proceeding.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Federal Housing Finance Agency – Office of Inspector General. The Office of the United States Trustee for the Middle District of Florida (Tampa Division) also provided substantial assistance. It will be prosecuted by Special Assistant United States Attorney Chris Poor.
Tampa Man Caught in Undercover Sting Sentenced to 18 Years in Federal PrisonRead the Press Release
Tampa, Florida – U.S. District Judge Susan C. Bucklew has sentenced Javis D. Wilson (39, Tampa) to 18 years and 4 months in federal prison for possessing a firearm as a convicted felon.
Wilson pleaded guilty on November 8, 2017.
According to court documents, for well over one year, Wilson sold undercover agents cocaine, ammunition, and several firearms, including a Mossberg 30-06 caliber rifle, a Lorcin Engineering .25 caliber handgun, and a Taurus International .40 caliber handgun. In total, Wilson was held responsible for the sale of 9 firearms. Wilson had reason to believe that the firearms would be trafficked to and resold in the New York area.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives. It is being prosecuted by Assistant United States Attorney Frank Murray.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. In October 2017, Attorney General Jeff Sessions announced the reinvigoration of PSN and directed all U.S. Attorneys’ Offices to develop districtwide crime reduction strategies, incorporating the lessons learned since the program’s inception in 2001. In the Middle District of Florida, U.S. Attorney Maria Chapa Lopez coordinates PSN efforts in cooperation with various federal, state, and local law enforcement officials.
Sun Valley Resident Sentenced to 54 Months Imprisonment for Role in International Money Laundering and Identity Theft Scheme Involving $14 Million in Fraudulent Tax RefundsRead the Press Release
SANTA ANA – A Sun Valley man was sentenced late Monday afternoon to 54 months imprisonment for his participation in a large-scale international identity theft scheme that fraudulently obtained tax refunds by using bogus Republic of Armenia passports and then engaged in money laundering of over $14 million of these criminal proceeds.
Karen Pogosian, 47, was sentenced by United States District Judge Andrew J. Guilford. In addition to the prison term, Judge Guilford ordered Pogosian to pay restitution of $277,617 to the Internal Revenue Service.
Pogosian pled guilty in September of last year to one count of bank fraud and one count of aggravated identity theft.
According to documents filed with the court, the scheme involved over 7,000 false tax returns that together claimed approximately $38 million in refunds. Approximately $14 million obtained through the fraud scheme was then deposited into bank accounts to conceal its illegal source. The tax returns were filed using identity information stolen from thousands of victims.
From August 2012 through March 2014, Pogosian opened mailbox and bank accounts using fraudulent identification with the names and personal information of identity theft victims. Pogosian also used the identification documents to create other IDs. For example, Pogosian used a foreign passport in the name of another person to obtain a Costco membership card also in that same person’s name, but with Pogosian’s photograph.
Pogosian’s use of stolen identities resulted in approximately $277,617 in loses. According to court records, defendant was present illegally in the U.S. at the time he committed the crimes and had been receiving public benefits.
The case against Pogosian is part of a larger investigation in which 14 defendants have been charged, nine defendants have pled guilty (eight have been sentenced), two are fugitives, two are pending trial and one is awaiting extradition.
The ongoing investigation into money laundering involving fraudulently obtained tax refunds and related frauds is being conducted by IRS Criminal Investigation, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, and the Federal Bureau of Investigation.
The case is being prosecuted by Assistant United States Attorney Charles Pell of the Santa Ana Branch Office. Assistant United States Attorney Frank Kortum represents the United States in the civil forfeiture action.
Stockton Man Pleads Guilty to Sex Trafficking of A ChildRead the Press Release
SACRAMENTO, Calif. —Ricky Lee Richardson, Jr., 41, of Stockton, pleaded guilty today to sex trafficking of a child, United States Attorney McGregor W. Scott announced.
According to court documents, in November 2011, Richardson recruited a minor victim to engage in prostitution. Between December 2011 and March 2012, Richardson caused the then 16-year-old victim to engage in prostitution in Stockton and elsewhere in Northern California. Richardson arranged for photos to be taken of the victim and he posted prostitution advertisements on the internet that contained nude photos of the victim. Richardson drove the victim to motels and gave her false identification cards that she used to rent rooms for the prostitution activity. Richardson took the money that the victim obtained from that activity.
This case was the product of an investigation by the Federal Bureau of Investigation, with assistance from the Stockton Police Department. Assistant United States Attorneys Brian A. Fogerty and Jill M. Thomas are prosecuting the case.
Richardson has been in custody since his arrest in April 2016.
Richardson is scheduled to be sentenced by Judge Troy L. Nunley on May 17, 2018. Richardson faces a maximum statutory penalty of life in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
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 those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet safety education.
Statement by Attorney General Sessions on the Confirmation of Assistant Attorney General for National Security John C. DemersRead the Press Release
Attorney General Jeff Sessions issued the following statement on the Senate’s confirmation of John C. Demers as Assistant Attorney General for the National Security Division: “Among his outstanding accomplishments in a distinguished legal career, John Demers was on the leadership team at the creation of the National Security Division, which today plays a crucial role in protecting Americans from the threat of terrorism, and protecting our national security from compromise by state-sponsored espionage, cyber intruders and the unauthorized disclosure of classified information,” said Attorney General Sessions. “I am grateful to the Senate for confirming John and I look forward to his return to the department, where his significant experience in both the private sector and public service will most certainly benefit the American people. We look forward to the Senate quickly confirming our remaining nominees.”
The mission of the National Security Division is to carry out the Department’s highest priority: protect the United States from threats to our national security by pursuing justice through the law. The NSD's organizational structure is designed to ensure coordination and unity of purpose between prosecutors and law enforcement agencies, on the one hand, and intelligence attorneys and the Intelligence Community, on the other, thus strengthening the effectiveness of the federal government’s national security efforts.
Prior to his confirmation, Mr. Demers was Vice President and Assistant General Counsel at The Boeing Company. He has held several senior positions at the company including in Boeing Defense, Space, and Security and as lead lawyer and head of international government affairs for Boeing International.
From 2006 to 2009, Mr. Demers served on the first leadership team of the Justice Department’s National Security Division, first as Senior Counsel to the Assistant Attorney General and then as Deputy Assistant Attorney General for the Office of Law & Policy. Before that, he served in the Office of Legal Counsel. For the past eight years, he has taught national security law as an adjunct professor at the Georgetown University Law Center.
Mr. Demers worked in private practice in Boston and clerked for Associate Justice Antonin Scalia of the U.S. Supreme Court and Judge Diarmuid O’Scannlain of the U.S. Court of Appeals for the Ninth Circuit. He graduated from Harvard Law School and the College of the Holy Cross.St. Petersburg Man Convicted of Federal Firearms OffenseRead the Press Release
Tampa, Florida – United States Attorney Maria Chapa Lopez announces that a federal jury has found Devin Fabian Collins (25, St. Petersburg) guilty of possessing a firearm as a convicted felon. He faces a minimum mandatory penalty of 15 years, up to life, in federal prison. His sentencing is scheduled for May 15, 2018.
Collins was indicted on May 18, 2017.
According to evidence presented at trial, Collins drove recklessly through St. Petersburg as he was being followed by a police helicopter. After he pulled into an apartment complex, officers arrived at scene. Collins fled on foot, while tossing drugs and a gun. At the time of the incident, Collins had a prior felony conviction and therefore was prohibited from possessing firearms or ammunition under federal law.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Pinellas County Violence Crimes Task Force. The Violent Crimes Task Force is comprised of officers from the Pinellas County Sheriff’s Office, the St. Petersburg Police Department, and the Clearwater Police Department. It is being prosecuted by Assistant United States Attorneys James Preston and Callan Albritton.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. In October 2017, Attorney General Jeff Sessions announced the reinvigoration of PSN and directed all U.S. Attorneys’ Offices to develop districtwide crime reduction strategies, incorporating the lessons learned since the program’s inception in 2001. In the Middle District of Florida, U.S. Attorney Maria Chapa Lopez coordinates PSN efforts in cooperation with various federal, state, and local law enforcement officials.
Sentencings for February 9 - February 12, 2018Read the Press Release
SAVON GERMAIN CARTER, 43, of Midvale, Utah, was sentenced by Federal District Court Judge Alan B. Johnson on February 12, 2018, for conspiracy to distribute methamphetamine. Carter received 135 months of imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and $900.00 in restitution. This case was investigated by the Sweetwater County Sheriff’s Office and the Wyoming Division of Criminal Investigation.
CHRISTINE MARIE EICHLER, 42, of Midvale, Utah, was sentenced by Federal District Court Judge Alan B. Johnson on February 12, 2018, for conspiracy to distribute methamphetamine. Eichler was arrested in Rock Springs, Wyoming. She received 121 months of imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and $500.00 in restitution. This case was investigated by the Sweetwater County Sheriff’s Office and the Wyoming Division of Criminal Investigation.
LEON ANTHONY DANIELS, 45, transient, was sentenced by Federal District Court Judge Scott W. Skavdahl on February 9, 2018, for possession with intent to distribute heroin and for being a felon and unlawful user of a controlled substance in possession of a firearm and ammunition. Daniels was arrested in Cheyenne, Wyoming. He received 108 months of imprisonment, to be followed by three years of supervised release, and was ordered to pay a $200.00 special assessment and $500.00 in restitution. This case was investigated by the Laramie County Sheriff’s Office, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the U.S. Drug Enforcement Administration.
Sallisaw Man Sentenced to 65 Months for Oxycodone DistributionRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Kevin Wayne Sanders Jr., age 29, of Sallisaw, Oklahoma, was sentenced to 65 months imprisonment and 6 years supervised release for Distribution Of Oxycodone, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C). The Indictment alleged that on or about January 14, 2016, within the Eastern District of Oklahoma, the defendant, did knowingly and intentionally distribute Oxycodone, a Schedule II controlled substance.
The charge arose from an investigation by the Oklahoma Bureau of Narcotics, the Sallisaw Police Department, and the Drug Enforcement Administration.
United States Attorney Brian J. Kuester said, “The misuse of Oxycodone and other prescription pain medications is wreaking havoc on our communities. Those people that unlawfully distribute those drugs do so for their own profit without regard for the lives that will be devastated, and they must be stopped. The investigation and prosecution of the defendant has stopped him from further distribution and hopefully will deter others from getting involved in the drug trade business. The law enforcement agencies that contributed to this investigation should be commended for their efforts.”
The Honorable Ronald A. White, U.S. District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearing. Assistant United States Attorney Timothy Hammer represented the United States.Pasco County Assistant Principal Indicted for Production of Child PornographyRead the Press Release
Tampa, Florida – United States Attorney Maria Chapa Lopez announces the return by a grand jury of an indictment charging Kyle Dale Ritsema (35, Land O’ Lakes) with production, possession, and distribution of child pornography. If convicted on all counts, he faces a maximum penalty of 30 years and a mandatory minimum penalty of 15 years in federal prison for production of child pornography, 20 years in federal prison for each of two counts for distributing child pornography, and 10 years in federal prison for possessing child pornography.
According to the indictment, in or about March 2015, Ritsema employed, used, persuaded, induced, enticed, and coerced a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of that conduct. The indictment also states that he distributed two visual depictions of child pornography on or about March 21, 2015.
Government records indicate that Ritsema is an Assistant Principal at Cypress Creek Middle High School, in Pasco County, Florida.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case is being investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, with assistance from the Florida Department of Law Enforcement. It will be prosecuted by Assistant United States Attorney Frank Murray.
Owner of New Jersey Hedge Fund Guilty of Wire Fraud and Securities Fraud for Defrauding Investors of $4 MillionRead the Press Release
NEWARK, N.J. – The owner and manager of a New Jersey hedge fund was convicted by a federal jury today for defrauding two investors of $4 million, U.S. Attorney Craig Carpenito announced.
Nicholas Lattanzio, 61, of Montclair, New Jersey, was convicted on all counts of an indictment charging him with two counts of wire fraud and two counts of securities fraud following a three-week trial before the Honorable Kevin McNulty in Newark federal court.
According to documents filed in this case and the evidence at trial:
From June 2013 through November 2014, Lattanzio orchestrated a large-scale scheme through which he, his hedge fund, the Black Diamond Capital Appreciation Fund L.P. (BD Fund), and several other related entities collected millions of dollars in upfront fees from two unsuspecting corporate investors in exchange for the promise of future loans or investment opportunities that did not materialize. Instead of investing the victims’ money as promised, Lattanzio stole the majority of the funds and used them to pay himself more than $500,000 in salary and for numerous personal expenses, including the purchase of a $1 million home in Montclair, New Jersey, a new Range Rover, a diamond ring that cost $100,000, and the payment of half a million dollars in credit card debt that he incurred for other personal expenses. Lattanzio lied to the victims about the status of their funds to conceal the scheme and mislead them into believing that their investments were safe.
The wire and securities fraud counts with which Lattanzio was convicted each carry a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss from the offense. The Government also forfeited a 2013 BMW 650 and various pieces of jewelry, and is seeking forfeiture of the home Lattanzio purchased in Montclair, New Jersey.
U.S. Attorney Carpenito credited special agents of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Timothy Gallagher in Newark, for the investigation leading to today’s conviction. He also thanked the U.S. Securities and Exchange Commission’s New York Regional Office, under the direction of Marc P. Berger, and the N.J. Bureau of Securities, within the State Attorney General’s Division of Consumer Affairs, under the direction of Attorney General Gurbir S. Grewal.
The government is represented by Assistant U.S. Attorneys Nicholas P. Grippo and Daniel V. Shapiro of the Economic Crimes Unit, and Assistant U.S. Attorney Peter Gaeta of the Office’s Asset Recovery and Money Laundering Unit.
Defense Counsel: John D. Arseneault, Esq. and John J. Roberts, Esq., Chatham, New Jersey
Owensboro, Kentucky Man Faces Additional Charges for Possessing Unregistered Machine Guns and FirearmsRead the Press Release
BOWLING GREEN, Ky. – An Owensboro, Kentucky man was charged in a superseding indictment this week, by a grand jury meeting in Bowling Green, Kentucky, with possessing unregistered machine guns announced United States Attorney Russell M. Coleman.
Glen Allan Aley, 45, was charged with 19 counts of possessing multiple types of firearms, including machine guns, short-barreled shotguns, short-barreled rifles, and silencers, that were not registered in the National Firearms Registration and Transfer Record.
Specifically, Aley was in possession of several .223 Wylde caliber, M-16-type firearms (machineguns); Fabrique Nationale Herstal, Model PS90 5.7x28mm caliber firearms (machineguns); Eds Tactical Armory, Model 2A, 7.62x39mm caliber AR-type firearm (short-barreled rifle); 7.62x51mm caliber AR-type firearm (machine gun); 7.62x51mm caliber AR-type firearm, (machine gun); AR-type firearm (short-barreled rifle); New England Firearms, Model SB2, 10-gague shotgun (short-barreled shotgun); and black cylindrical devices, (firearm silencers).
According to the superseding indictment, Aley possessed the firearms between February 16, 2017, and March 28, 2017.
Aley remains free on an unsecured $25,000 bond.
This case is being prosecuted by Assistant United States Attorney Nute Bonner and is being investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).
* * *
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Orlando Man Convicted of Two Counts of CarjackingRead the Press Release
Tampa, Florida – United States Attorney Maria Chapa Lopez announces that a federal jury today found Eugene Willis (24, Orlando) guilty of carjacking and brandishing a firearm in relation to a carjacking. He faces a minimum mandatory penalty of seven years, up to life, in federal prison. His sentencing hearing has not yet been set.
Willis was indicted on October 26, 2016, along with two co-conspirators, Sedrick Hamilton and Justin Crumpton.
According to testimony presented at trial, on October 8, 2016, Willis, Hamilton, and Crumpton traveled from Orlando to the Tampa Bay area to commit commercial burglaries. They decided to carjack a victim of his Dodge Charger, after getting the idea from a rap song. After a high-speed chase with law enforcement, they crashed the stolen car and carjacked a second victim of her Kia Optima. The individuals crashed that vehicle as well and fled to a nearby fast food restaurant, where two employees were taken as hostages. Law enforcement ultimately took all three men into custody.
Hamilton and Crumpton previously pleaded guilty for their roles in this case and are currently awaiting sentencing.
This case was investigated by Federal Bureau of Investigation, Bureau of Alcohol, Tobacco, Firearms and Explosives, the Hillsborough County Sheriff’s Office, and the Lakeland Police Department. It is being prosecuted by Assistant United States Attorney Carlton C. Gammons.
Oregon Man Pleads Guilty to Forced Labor and Related Crimes in Connection with Scheme to Coerce Thai Nationals to WorkRead the Press Release
Paul Jumroon, also known as Veraphon Phatanakitjumroon, 54, of Depoe Bay, Oregon, and a naturalized citizen originally from Thailand, pleaded guilty yesterday in a U.S. District Court in Portland, Oregon, to forced labor, visa fraud conspiracy, and filing a false federal income tax return, announced Acting Assistant Attorney General John Gore of the Justice Department’s Civil Rights Division, U.S. Attorney Billy J. Williams of the District of Oregon, Special Agent in Charge Renn Cannon of the FBI in Oregon, and Special Agent in Charge Darrell Waldon of IRS Criminal Investigation’s Seattle Field Office. Jumroon waived indictment by a federal grand jury and pleaded guilty to an information filed by the United States Attorney’s Office and the Civil Rights Division.
According to the defendant’s plea agreement and admissions in court, between 2011 and 2014, the defendant and his associates fraudulently obtained E-2 visas to bring Thai nationals into the United States to provide cheap labor at his restaurants, Curry in a Hurry in Lake Oswego, Oregon and Teriyaki Thai in Ridgefield, Washington. E-2 visas are granted to foreign nationals who invest substantial money in a U.S. business and direct its operations, and to employees who have special qualifications that make their services essential to that business.
Jumroon used the fraudulently obtained visas to entice four forced labor victims to come to the United States by making false promises to them. According to court documents, the first victim arrived in the United States in June 2012, and the second victim arrived in April 2013. Jumroon used inflated travel expenses, debt manipulation, threats of deportation, serious financial and reputational harm, verbal abuse, and control over identification documents, among other means, to compel the victims to work 12 hours a day, six to seven days a week, for minimal pay, until they managed to leave in October 2013 and 2014, respectively.
As part of the defendant’s guilty plea, Jumroon agreed to pay all four victims a combined $131,391.95 in restitution for their unpaid labor in connection with his forced labor scheme.
The defendant further admitted to filing multiple false tax returns with the Internal Revenue Service, failing to report cash income earned from his restaurants between 2012 and 2015. As part of the plea agreement, Jumroon agreed to pay tax due and owing in the amount of $120,384 to the IRS.
“Combatting human trafficking is a priority for Attorney General Sessions and the Justice Department,” said Acting Assistant Attorney General Gore of the Civil Rights Division. “Securing a guilty plea today is just another example of this commitment and the work of the Civil Rights Division, in coordination with the U.S. Attorney’s Office, to hold those who choose to exploit vulnerable individuals accountable for their actions.”
“Human trafficking is a degrading crime that undermines our nation’s most basic promise of liberty. This defendant preyed on the hopes of vulnerable workers, using fear to compel them to work long hours for little pay. He turned a promise of employment and a better life into a human tragedy for his own financial gain,” said U.S. Attorney Billy J. Williams for the District of Oregon. “This case demonstrates our firm commitment to holding traffickers accountable and restoring the rights, freedom and dignity of victims. It should also serve as a reminder that these types of crimes happen all around us and often in plain sight. We encourage all Oregonians to remain watchful for signs of human trafficking and to notify law enforcement immediately when something seems amiss.”
“The American dream is built on the belief that hard work can bring about a better life. For the victims in this case, that dream turned into a nightmare of false promises, forced labor and abuse,” said Renn Cannon, Special Agent in Charge of the FBI in Oregon. “These cases are very difficult to identify and work, so we are thankful the courageous victims in this case were able to reach out for help through trusted community contacts.”
“Forced labor schemes, such as the one employed by Paul Jumroon, are deplorable crimes that have no place in today’s society,” said Darrell Waldon, Special Agent in Charge of IRS Criminal Investigation’s Seattle Field Office. “Falsely reporting income and expenses associated with such schemes will continue to be vigorously investigated by IRS-CI Special Agents.”
Jumroon faces a maximum of 20 years in prison for forced labor, five years in prison for visa fraud conspiracy, and three years in prison for filing a false tax return. His sentencing is scheduled for May 24 before United States District Judge Anna J. Brown.
Attorney General Sessions recently issued a proclamation commemorating January as National Slavery and Human Trafficking Prevention Month, and the Justice Department recently hosted a Human Trafficking Summit where both the Attorney General and Associate Attorney General Rachel Brand gave remarks.
The District of Oregon is one of six districts designated through a competitive, nationwide selection process as a Phase II Anti-Trafficking Coordination Team (ACTeam), through the interagency ACTeam Initiative of the Departments of Justice, Homeland Security and Labor. ACTeams focus on developing high-impact human trafficking investigations and prosecutions involving forced labor, international sex trafficking and sex trafficking by force, fraud or coercion through interagency collaboration among federal prosecutors and federal investigative agencies.
This prosecution is the result of the joint investigation by the Federal Bureau of Investigation, Homeland Security Investigations, Internal Revenue Service Criminal Investigation and Department of State’s Diplomatic Security Service, with assistance from the Department of Labor’s Wage and Hour Division and Portland Police Bureau. The case is being prosecuted by Assistant U.S. Attorneys Hannah Horsley and Scott Bradford of the District of Oregon, and Lindsey Roberson of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Update: Defendant Paul Jumroon no longer owns either of the two restaurants mentioned in this release.
Operator of Massachusetts Temp Agency Pleads Guilty to Employment Tax Fraud and Obstructing the IRSRead the Press Release
A Massachusetts temporary employment agency operator pleaded guilty today in Boston federal district court to an indictment charging him with conspiring to defraud the government, failing to pay over employment taxes and obstructing the internal revenue laws, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
According to the indictment and statements provided in Court, Tien Chau ran an employment agency that provided temporary labor to businesses in Massachusetts and New Hampshire. The agency operated under at least four different names: Central Boston Staffing Services, Metro Boston Staffing Services, General Staffing Inc. and Kim’s Staffing Inc. Chau and others used nominees to conceal their ownership of the business.
From 2006 through 2011, Chau and others conspired to conceal the agency’s total number of employees from the Internal Revenue Service (IRS) to lower the staffing agencies’ employment tax liabilities. Chau attempted to hide the size of their workforce from the IRS by paying most of the employees cash under the table and filing false employment tax returns that both underreported the number of employees and omitted wages paid in cash. Chau and others in the conspiracy allegedly cashed over $11 million in client checks at a check cashing facility in Worcester and used the staffing agency’s site supervisors, office manager and drivers to pay the employees in cash.
The conspirators sought to obstruct an investigation by, among other things, directing an employee, after learning of her interview with special agents, to assist with shredding the agency’s records. Chau also allegedly destroyed and removed computers and computers equipment from the business’s office.
A sentencing date has been set for May 17, 2018. Chau faces a statutory maximum sentence of five years in prison for the conspiracy charge, five years in prison for each employment tax count, and three years in prison for obstructing the internal revenue laws. He also faces a period of supervised release, restitution and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman thanked special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorneys Brittney Campbell and Shawn Noud 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.
Olney, Illinois Woman Sentenced on Methamphetamine Related ChargesRead the Press Release
Kylee D. Black, 34, of Olney, IL, was sentenced on February 14, 2018, to federal prison on methamphetamine related charges, Donald S. Boyce, United States Attorney for the Southern District of Illinois, announced today.
Black was sentenced to 168 months’ imprisonment and four years’ supervised release following her imprisonment. Black previously pled guilty to six counts of a federal indictment brought against her.
Count 1 charged that from around 2015, until on or about April 21, 2017, in Richland County, Vickie Sanders, 57, of Olney, Illinois, and Black conspired with others known and unknown to the Grand Jury to knowingly and intentionally manufacture fifty (50) grams or more of methamphetamine.
Counts 3-6 charged that Sanders and Black knowingly and intentionally possessed Pseudoephedrine knowing that the Pseudoephedrine would be used to manufacture methamphetamine. The dates involved were December 21, 2016 (Count 3), December 15, 2015 (Count 4), September 30, 2015 (Count 5), and April 3, 2015 (Count 6).
Count 7 charged that on May 14, 2017, in Richland County, Black knowingly and intentionally distributed methamphetamine.
Sanders has also pleaded guilty to charges against her and is scheduled for sentencing on March 13, 2018, in the United States District Court in Benton, Illinois.
The investigation in this case was conducted by the Richland County Sheriff’s Office.
New Indictment Charges Columbus MS-13 Gang Members with Conspiracy to Commit Racketeering, Including Five Central Ohio MurdersRead the Press Release
COLUMBUS, Ohio – A second superseding indictment returned here today charges 23 individuals alleged to be members and associates of the Columbus clique of MS-13 in a racketeering conspiracy, which includes five murders as well as attempted murder, extortion, money laundering, drug trafficking, assault, obstruction of justice, witness intimidation, weapons offenses and immigration-related violations.
The most recent indictment also includes three counts of murder in aid of racketeering and one count of murder through the use of a firearm during and in relation to a crime of violence, crimes that could make some of the defendants eligible for the death penalty.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Division, Rebecca Adducci, Detroit Field Office Director, U.S. Immigration and Customs Enforcement (ICE) Enforcement and Removal Operations, Franklin County Sheriff Dallas Baldwin and Columbus Police Chief Kim Jacobs announced the new charges.
Those named in today’s indictment include:
Name
Also Known As
Age
City
Martin Neftali Aguilar-Rivera
Momia, Pelon
32
Columbus, Ohio / Indianapolis
Jose Bonilla-Mejia
Espia
29
California
Juan Jose Jiminez-Montufar
Chele Trece
34
Columbus, Ohio
Pedro Alfonso Osorio-Flores
Smokey
38
Columbus, Ohio
Isaias Alvarado
Cabo
45
Columbus, Ohio
Cruz Alberto-Arbarngas
Cruzito
30
Columbus, Ohio
Jose Manuel Romero-Parada
Russo
23
Indianapolis
Juan Jose Alvarenga-Alberto
Sailen
27
Columbus, Ohio
Juan Pablo Flores-Castro
Duende
29
Columbus, Ohio
Jose Daniel Gonzalez-Campos
Flaco
29
Virginia
Jose Salvador Gonzalez-Campos
Danger
27
Indianapolis/ Virginia
Jose Mendez-Peraza
Shadow
36
Columbus, Ohio
Erasmo Humberto Lima-Martinez
Tun Tun, Azul, Chino
31
Columbus, Ohio
Nehemias Joel Martinez-Hernandez
Mysterio
21
Columbus, Ohio
Jose Carlos Mercado-Crespin
Payaso
32
Ohio
Denis Donaldo Fuentes-Avila
18
Columbus, Ohio
Daniel Alexander Diaz-Romero
Manchas
24
Deported
Gerardo Davila-Colindres
Cuervo, Enano
39
Columbus, Ohio
Marvin Otero-Serrano
Vaca, Bandallero, Yankee
31
Columbus, Ohio
Jorge Alberto Landaverde
Grenas
34
Columbus, Ohio
Jose Salinas-Enriquez
Martillo
32
Dayton, Ohio
*Nelson Alexander Flores
Mula
46
Fugitive
Carolina Garcia-Miranda
Mamayema
30
Columbus, Ohio
*Fugitive
Charged with murder
Since the beginning of this investigation, additional defendants have been arrested and charged in criminal complaints with federal immigration-related crimes.
MS-13
- MS-13, formally La Mara Salvatrucha, is a multi-national criminal organization composed primarily of immigrants or descendants of immigrants from El Salvador, Guatemala and Honduras. The organization’s leadership is based in El Salvador, where many of the gang’s high-ranking members are imprisoned.
- In 2012, the United States government designated MS-13 as a “transnational criminal organization.” It is the first and only street gang to receive that designation. MS-13 has become one of the largest and most violent criminal organizations in the United States, with more than 10,000 members and associates operating in at least 40 states, including Ohio.
- In Ohio and elsewhere in the United States, MS-13 is organized into “cliques,” which are smaller groups of MS-13 members and associates acting under the larger mantle of the organization and operating in a specific region, city or part of a city. Cliques are grouped into larger “programs,” and the Columbus, Ohio clique of MS-13 is part of the East Coast Program.
- Cliques raise money through various forms of criminal activity, including extortion and narcotics trafficking, in addition to paying regular dues at clique meetings, and a portion of that money is wired to leadership in El Salvador. Gang leaders use this money to purchase weapons and cell phones and to provide clothing, legal assistance and other forms of aid to MS-13 members who are incarcerated and to support the families of MS-13 members who have been killed.
- Violence is a central tenet of MS-13. The organization’s motto, “mata, viola, controla,” means kill, rape, control. Historically, MS-13 members and associates have committed murders and other violent acts using machetes, knives and similar bladed weapons in order to intimidate and instill fear in others.
This Case
In July 2017, a federal grand jury charged 10 individuals with conspiracy to commit extortion, conspiracy to commit money laundering and use of a firearm during and in relation to a crime of violence.
In December 2017, a superseding indictment charged four additional defendants and added charges of cocaine and marijuana distribution, illegal possession of firearms and ammunition, obstruction of justice and illegal re-entry into the United States. Today’s second superseding indictment alleges the defendants have engaged in a racketeering conspiracy since approximately 2006 in the Southern District of Ohio and elsewhere.
The racketeering activity involves multiple acts of murder, extortion, drug trafficking, money laundering, obstruction of justice and witness intimidation.
The second superseding indictment alleges that defendants committed a host of overt acts in furtherance of the conspiracy, including: 1) the December 2006 murder of Jose Mendez, a suspected confidential informant, in Perry County; 2) the November 2008 murder of Ramon Ramos on Lockbourne Road in Columbus; 3) the mid-2015 murder of Carlos Serrano-Ramos, a suspected rival gang member, near Innis Road in Columbus; 4) the November 2015 murder of Wilson Villeda near Innis Road in Columbus; and 5) the December 2016 murder of Salvador Martinez-Diaz, a suspected rival gang member, on Melroy Avenue in Columbus.
Other criminal activity detailed in the newest indictment includes burning a victim’s car when the victim refused to be extorted for money, conspiring to murder at least one potential witness, threatening the lives of a Transnational Anti-Gang Unit officer and the officer’s family in El Salvador, threatening to kill an individual’s family if he cooperated with law enforcement, possessing multiple firearms and ammunition, possessing and distributing cocaine and marijuana and destroying evidence.
The crimes charged in this case and each crime’s potential maximum sentence include:
Crime
Potential Maximum Sentence
Conspiracy to commit racketeering
Life in prison (for defendants who committed murder)
20 years in prison (for all other defendants)
Murder in aid of racketeering
Life in prison or death
Murder through use of a firearm during and in relation to a crime of violence
Life in prison or death
Brandishing a firearm during and in relation to a crime of violence
At least 7 years in prison, consecutive to any other sentence imposed
Using a firearm during and in relation to a crime of violence
At least 5 years in prison, consecutive to any other sentence imposed
Possession with intent to distribute controlled substances
20 years in prison
Alien in possession of firearm or ammunition
10 years in prison
Obstruction of justice
20 years in prison
Destruction or removal of property to prevent seizure
5 years in prison
Illegal re-entry of a removed alien
2 years in prison
U.S. Attorney Glassman commended the investigation of this case by the FBI, ICE, Columbus Division of Police and Franklin County Sheriff’s Office, and the assistance of the Ohio Bureau of Criminal Investigation (BCI) and Homeland Security Investigations (HSI), as well as Assistant United States Attorneys Brian J. Martinez and Jessica H. Kim, who are prosecuting the case. The Organized Crime and Gang Section of the Criminal Division of the Department of Justice assisted in reviewing the racketeering charges.
An indictment, superseding indictment or criminal complaint merely contains allegations, and the defendants are presumed innocent unless proven guilty in a court of law.
If you are a victim of the alleged crimes, or have additional information about MS-13, please call the FBI hotline at 614-849-1765. Callers can remain anonymous.
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- MS-13, formally La Mara Salvatrucha, is a multi-national criminal organization composed primarily of immigrants or descendants of immigrants from El Salvador, Guatemala and Honduras. The organization’s leadership is based in El Salvador, where many of the gang’s high-ranking members are imprisoned.
New Boston Man Sentenced to 37 Months in Prison for Bank RobberyRead the Press Release
CONCORD, N.H. - Robert A. Ruggiero, 24, of New Boston, was sentenced to serve 37 months in federal prison for bank robbery, Acting United States Attorney John J. Farley announced today.
According to court documents and statements made in court, on February 8, 2017, Ruggiero walked into a Citizens Bank branch in Goffstown, New Hampshire, and handed the teller a note demanding money. The teller gave Ruggiero a quantity of United States currency. Surveillance cameras captured images of the robbery, which were broadcast on local news outlets and distributed via social media. Numerous individuals identified Ruggiero from the photographs and he was apprehended later that day.
Ruggiero pleaded guilty to the offense on November 9, 2017. After serving his sentence, he will be on supervised release for three years.
“Bank robbery is a violent crime that endangers both bank employees and members of the public,” said Acting U.S. Attorney Farley. “We will continue to work with our law enforcement partners to identify and prosecute those who commit bank robberies and other violent offenses so that we can improve the safety of our community.”
“Mr. Ruggiero's unlawful behavior brought fear and concern to bank employees," said Harold H. Shaw, Special Agent in Charge, Federal Bureau of Investigation (FBI) Boston Division. "The FBI is grateful for the public's assistance in helping us identify him, and we are fully committed to working with all of our law enforcement partners to combat violent crime and improve the safety of our communities."
This matter was investigated by the Federal Bureau of Investigation and the Goffstown Police Department. The case was prosecuted by Assistant U.S. Attorney Anna Dronzek.
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Nebraska Man Sentenced for Conversion of Mortgaged PropertyRead the Press Release
United States Attorney Ron Parsons announced that a Harrison, Nebraska, man convicted of Conversion of Mortgaged Property was sentenced on February 7, 2018, by Chief Judge Jeffrey L. Viken, U.S. District Court.
Paxton Carrier, age 24, was sentenced to 12 months of imprisonment and ordered to pay a $100 special assessment to the Federal Crime Victims Fund and $275,403.52 in restitution to the Farm Service Agency.
Carrier was charged on April 18, 2017, and pleaded guilty on November 3, 2017. The charge related to Carrier obtaining a loan from the Farm Services Agency (FSA), and then selling a large portion of the collateral mortgaged by the loan. Rather than paying the FSA loan as required after the sale of collateral, Carrier used the proceeds to pay other debts and purchase personal items. Carrier never made a payment on the FSA loan.
This case was investigated by the Office of Inspector General, United States Department of Agriculture. Assistant U.S. Attorney Benjamin Patterson prosecuted the case.
Nebraska Man Pleads Guilty to Producing Child PornographyRead the Press Release
A Nebraska man pleaded guilty today to producing child pornography between 2015 and 2016, announced Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division and Acting U.S. Attorney Robert C. Stuart of the District of Nebraska.
Nicholas Alford, 26, of Bellevue, Nebraska, pleaded guilty to one count of production of child pornography before Chief U.S. District Court Judge Laurie Smith Camp of the District of Nebraska. Sentencing is set for May 14.
According to admissions made in connection with his guilty plea, in July 2015, Alford provided a 13-year-old minor with the username for a Kik Messenger account user who Alford claimed would pay the minor money in exchange for sexually explicit images. Alford was actually the user of the Kik Messenger account, and, in that capacity, he persuaded the minor to send dozens of sexually explicit images to his Kik Messenger account. A search warrant executed on Alford’s Bellevue residence resulted in the discovery of dozens of images and videos depicting the minor engaged in sexually explicit conduct.
The FBI is investigating this case. Trial Attorney William M. Grady of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Michael P. Norris of the District of Nebraska are prosecuting the case.
This investigation is a part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Mt. Pleasant Man Sentenced to 15 Years in Prison for Child PornographyRead the Press Release
DAVENPORT, Iowa - On February 14, 2018, United States District Court Chief Judge John A. Jarvey sentenced Joel Allen Corder, age 45, of Mount Pleasant, Iowa, to 180 months in prison for receiving and possessing child pornography, announced United States Attorney Marc Krickbaum. Corder was ordered to serve five years of supervised release following his imprisonment, to pay $200 to the Crime Victims’ Fund, and to comply with the sex offender registry requirements upon release.
On August 18, 2017, Corder pleaded guilty to the charges. The investigation began in October 2016, when an internet company notified the National Center for Missing and Exploited Children (NCMEC) that “twistedmind31,” a name used by Corder, attempted to send four images child pornography to another person.
On December 20, 2016, officers met with Corder to discuss the child pornography investigation. Corder’s cellular phone was seized and subsequently examined. The examiner recovered 638 images containing child pornography. In addition to the child pornography, the examiner found a series of KIK chats containing sexual content between Corder and an 11-year- old female who lived in Texas. In an interview, Corder admitted in 2016 he began receiving and possessing child pornography. Corder admitted he communicated with an 11-year-old female through KIK messenger and asked her to send nude photographs of herself on more than one occasion. The victim sent pictures of her exposed genitalia as requested, which he then stored on his cellular phone.
This matter was investigated by the Federal Bureau of Investigation and NCMEC. This case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa as part of the United States Department of Justice’s “Project Safe Child” initiative, which was started in 2006 as a nationwide effort to combine law enforcement investigations and prosecutions, community action, and public awareness in order to reduce the incidence of sexual exploitation of children.
Any persons having knowledge of a child being sexually abused are encouraged to call the Iowa Sexual Abuse Hotline at 1-800-284-7821.
Mississippi Real Estate Investors Plead Guilty to Conspiracy to Rig Bids at Public Foreclosure AuctionsRead the Press Release
Two real estate investors pleaded guilty today for their roles in a conspiracy to rig bids at public real estate foreclosure auctions in Mississippi, the Department of Justice announced.
“Shannon and Jason Boykin are the first two defendants to plead guilty in the Antitrust Division’s active, ongoing investigation into anticompetitive behavior at real estate foreclosure auctions in Mississippi,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “In the past few years, the Division has secured convictions of over 100 individuals around the country. The Division remains committed to rooting out anticompetitive conduct at foreclosure auctions.”
Felony charges against Shannon Boykin and Jason Boykin were filed on February 1, 2018, in the U.S. District Court for the Southern District of Mississippi. According to court documents, from at least as early May 22, 2012, through at least as late as March 22, 2017, Jason and Shannon Boykin conspired with others to rig bids, designating a winning bidder to obtain selected properties at public real estate foreclosure auctions in the Southern District of Mississippi. Co-conspirators made and received payoffs in exchange for their agreement not to bid.
“Rigging, cheating and swindling foreclosure auctions undermines confidence in the marketplace, defrauds companies, and hurts owners of foreclosed homes. These criminal actions harm us all, and I commend the Antitrust Division and the FBI for their investigation and prosecution of these crimes throughout the country. This office will continue to work with our law enforcement partners to combat illegal, anticompetitive behavior and protect victims,” said United States Attorney D. Michael Hurst, Jr. for the Southern District of Mississippi.
“The criminal actions of the defendants in this case provide a clear example of why enforcement of the Sherman Act remains necessary in maintaining a competitive field of commerce,” said Special Agent in Charge Christopher Freeze of the FBI in Mississippi. “The FBI will continue to work with the U.S. Department of Justice’s Antitrust Division in identifying such financial schemes that attempt to take advantage of the competitive process, including schemes targeting foreclosure auctions.”
The Department said that the primary purpose of the conspiracy was to suppress and restrain competition in order to obtain selected real estate offered at public foreclosure auctions at non-competitive prices. When real estate properties are sold at these auctions, the proceeds are used to pay off the mortgage and other debt attached to the property, with remaining proceeds, if any, paid to the homeowner. According to court documents, these conspirators paid and received money in connection with their agreement to suppress competition, which artificially lowered the price paid at auction for such homes.
A violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine for a Sherman Act charge may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime if either amount is greater than the statutory maximum fine.
The investigation is being conducted by the Antitrust Division’s Washington Criminal II Section and the FBI’s Gulfport Resident Agency, with the assistance of the U.S. Attorney’s Office for the Southern District of Mississippi. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact Antitrust Division prosecutors in the Washington Criminal II Section at 202-598-4000, or visit https://www.justice.gov/atr/report-violations.
Mexican Woman Sentenced to Prison for Using a Fraudulent Social Security Card to Get a JobRead the Press Release
A Mexican woman who aided and abetted her husband in absconding from justice in Nebraska and assumed a new identity in Iowa was sentenced on February 14, 2018, to three months in federal prison.
Rosa Nevarez-Fallad, age 60, a citizen of Mexico and lawful permanent resident of the United States residing in Fremont, Nebraska, received the prison term after a September 28, 2017, guilty plea to one count of unlawful use of an identification document.
At the guilty plea, Nevarez-Fallad admitted she used a Social Security card knowing that the card was forged or unlawfully obtained. In 2016, Nevarez-Fallad’s husband, Fernando Nevarez-Carreon, faked a heart attack and fled Nebraska to avoid sentencing in federal court for conspiracy to distribute counterfeit documents and aggravated identity theft. In July 2016, Nevarez-Fallad and Nevarez-Carreon both completed employment paperwork in Farley, Iowa, to obtain jobs under false names and used identification cards bearing the names and Social Security Numbers of United States citizens. Nevarez-Carreon avoided apprehension by law enforcement until March 2017, when he was arrested at his place of employment in Farley. Nevarez-Carreon was sentenced to more than six years in prison in the United States District Court for the District of Nebraska in June 2017 and is awaiting sentencing in the Northern District of Iowa for one count of unlawful use of an identification document.
Nevarez-Fallad was sentenced in Cedar Rapids by United States District Court Judge Linda R. Reade. Nevarez-Fallad was sentenced to three months’ imprisonment. She must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Nevarez-Fallad is being held in the United States Marshal’s custody until she can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Daniel C. Tvedt and investigated by the Social Security Administration, Office of Inspector General, and the Department of Homeland Security, Immigration and Customs Enforcement, Homeland Security Investigations.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 17-CR-1026-LRR.
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Mexican National Pleads Guilty to Cocaine Trafficking and Immigration ChargesRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that LUIS PALACIOS ORTIZ, 44, a citizen of Mexico, pleaded guilty today before U.S. District Judge Michael P. Shea in Hartford to cocaine trafficking and immigration offenses.
According to court documents and statements made in court, on February 13, 2017, the Connecticut State Police stopped a car that PALACIOS ORTIZ was driving on I-84 East near Waterbury. A subsequent search of the vehicle revealed approximately 4.5 kilograms of cocaine.
PALACIOS ORTIZ, who did not possess a valid driver’s license, had been previously deported from the U.S.
PALACIOS ORTIZ pleaded guilty to one count of possession with intent to distribute 500 grams or more of cocaine, an offense that carries a maximum term of imprisonment of 40 years, and one count of reentry of a removed alien, an offense that carries a maximum term of imprisonment of 10 years.
Under the terms of a binding plea agreement, if accepted by the court, the parties have agreed that a term of imprisonment of 60 months is an appropriate sentence in this case.
Judge Shea scheduled sentencing for May 14, 2018.
PALACIOS ORTIZ has been detained since February 13, 2017.
This investigation is being conducted by the Drug Enforcement Administration and the Connecticut State Police. The case is being prosecuted by Assistant U.S. Attorney Rahul Kale.
Massachusetts Man Sentenced for Mailing Threatening CommunicationsRead the Press Release
CONCORD, N.H. - Michael Dube, 48, of Tewksbury, Massachusetts, was sentenced to five years of probation and a $16,500 fine for mailing threatening communications, Acting United States Attorney John J. Farley announced today.
According to court documents and statements made in court, between March 2, 2016 and June 2, 2016, Dube sent three letters to victims located in New Hampshire, which contained threats to break the addressee’s legs, sexually assault his daughter, and to kill his son. The letters were postmarked in Boston and delivered to a residence in Sandown, New Hampshire.
Dube previously pleaded guilty to three counts of mailing threatening communications.
“By sending these threatening communications to the victim, the defendant attempted to create a climate of fear and intimidation,” said Acting U.S. Attorney Farley. “Such conduct cannot be tolerated. I commend the law enforcement officers whose work led to the successful identification and prosecution of this defendant.”
“Mr. Dube was blinded by his obsession and oblivious to the impact of his crimes. He carried out a relentless stalking campaign whereby he violated his victim’s privacy and threatened those around him,” said Harold H. Shaw, Special Agent in Charge, Federal Bureau of Investigation Boston Division. (FBI) “Violence through words or actions cannot be tolerated and the FBI will continue to do everything it can to identify, arrest, and bring those to justice who engage in similar criminal conduct.”
This Sandown Police Department initiated the investigation of the case. The Federal Bureau of Investigation, the Derry Police Department, the Salem Police Department, the Raymond Police Department, and the Tewksbury Police Department assisted in the investigation. The case was prosecuted by Assistant United States Attorneys Helen Fitzgibbon and Donald Feith.
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Mansfield man charged with stalkingRead the Press Release
A Mansfield man was charged with stalking, said U.S. Attorney Justin E. Herdman.
Gary L. Fisher, 44, used the mail in August 2017, in an attempt to cause emotional distress to the victim, according to the indictment.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant's role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorneys Michael A. Sullivan and Danielle Angeli following an investigation by the United States Marshal’s Service, the Mansfield office of the Federal Bureau of Investigation and the Mansfield Police Department.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Manhattan U.S. Attorney Announces Criminal Charges Against U.S. Bancorp for Violations of the Bank Secrecy ActRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced criminal charges against U.S. Bancorp (“USB”) consisting of two felony violations of the Bank Secrecy Act (“BSA”) by its subsidiary, U.S. Bank National Association (the “Bank”), the fifth largest bank in the United States, for willfully failing to have an adequate anti-money laundering program (“AML”) and willfully failing to file a suspicious activity report (“SAR”). The case is assigned to United States District Judge Lewis A. Kaplan.
Mr. Berman also announced an agreement (the “Agreement”) under which USB agreed to accept responsibility for its conduct by stipulating to the accuracy of an extensive Statement of Facts, pay a $528 million penalty, and continue reforms of its BSA/AML compliance program. Assuming USB’s continued compliance with the Agreement, the Government has agreed to defer prosecution for a period of two years, after which time the Government will seek to dismiss the charges. The Agreement is pending review by the Court. The penalty shall be collected through the Bank’s forfeiture to the United States of $453 million in a civil forfeiture action also filed today, with the remaining $75 million satisfied by the Bank’s payment of a civil money penalty assessed by the Office of the Comptroller of the Currency (the “OCC”).
U.S. Attorney Geoffrey S. Berman stated: “U.S. Bank’s AML program was highly inadequate. The Bank operated the program ‘on the cheap’ by restricting headcount and other compliance resources, and then imposed hard caps on the number of transactions subject to AML review in order to create the appearance that the program was operating properly. The Bank also concealed its wrongful approach from the OCC. As a result, U.S Bank failed to detect and investigate large numbers of suspicious transactions. With today’s resolution, the Bank has accepted responsibility for its criminal conduct and committed to completing the reform of its AML program.”
The OCC, the Financial Crimes Enforcement Network (“FinCEN”), and the Board of Governors of the Federal Reserve System (”FRB”) have also reached agreements with the Bank to resolve related regulatory actions. For purposes of its action, which was also filed today, FinCEN is represented by this Office’s Civil Division. FinCEN’s agreement with the Bank requires the Bank to pay an additional $70 million for civil violations of the BSA, and it includes further admissions by the Bank, including that the Bank filed more than 5,000 currency transaction reports with incomplete and inaccurate information, which impeded law enforcement’s ability to identify and track potentially unlawful behavior. FinCEN’s agreement with the Bank is pending review by the Court.
According to the documents filed today in Manhattan federal court:
USB’s Failure to Maintain an Adequate AML Program
From 2009 and continuing until 2014, USB willfully failed to establish, implement, and maintain an adequate AML program. Among other things, USB capped the number of alerts generated by its transaction monitoring systems, basing the number of such alerts on staffing levels and resources, rather than setting thresholds for such alerts that corresponded to a transaction’s level of risk. The Bank deliberately concealed this from the OCC, the Bank’s primary regulator.
USB was well aware that these practices were improper, were resulting in the Bank missing substantial numbers of suspicious transactions, and were placing the Bank at risk of regulatory action. Bank documentation from as early as 2005 acknowledged that alert limits were based on staffing levels and, as a result, a risk item for the bank. For example, in a December 1, 2009,F memo from the Bank’s then AML Officer (the “AMLO”) to the then Chief Compliance Officer (the “CCO), the AMLO explained that while the Bank was experiencing significant increases in SAR volumes, the Bank’s staff was “stretched dangerously thin” and warned that a “regulator could very easily argue that this testing should lead to an increase in the number of queries worked.” The Bank conducted below-threshold testing (“BTT”), which consisted of investigating a limited number of transactions that fell outside alert limits to see if thresholds should be adjusted so that more alerts would be investigated. The Bank’s BTT regularly found that SARs should have been filed on more than 25 percent, and as much as 80 percent, of the tested transactions. Rather than increase resources and lower thresholds to detect such suspicious activity, as repeatedly requested by the responsible AML employees, the Bank instead decided to stop conducting BTT altogether.
An OCC examiner assigned to the Bank repeatedly warned USB officials, including the AMLO, of the impropriety of managing the Bank’s monitoring programs based on the size of its staff and other resources. Knowing that the OCC would find USB’s resource-driven alert limits to be improper, Bank officials, including the CCO, deliberately concealed these practices from the OCC. For example, a Bank employee deliberately excluded references to resource limitations from the minutes of an internal Bank meeting for fear that the OCC would disapprove of the Bank’s practices, and in order to protect himself and his supervisor from adverse consequences. Indeed, the AMLO described USB’s AML program to another senior manager as an effort to use “smoke and mirrors” to “pull the wool over the eyes” of the OCC.
USB also failed to monitor Western Union (“WU”) transactions involving non-customers of the Bank that took place at Bank branches. The Bank processed WU transactions involving non-customers even though they would not be subject to the Bank’s transaction monitoring systems. Even when Bank employees flagged specific non-customer transactions raising AML-related concerns, the transactions went uninvestigated. It was not until July 1, 2014, that the Bank implemented a new policy that prohibited WU transactions by non-customers.
In the course of this investigation, the Bank analyzed the impact of its deficient monitoring practices. For just the six months prior to taking steps to remedy the practices, the Bank’s analysis resulted in the generation of an additional 24,179 alerts and the filing of 2,121 SARs.
USB’s Failure to Timely File Suspicious Activity Reports Relating to Scott Tucker
From October 2011 through November 2013, the Bank willfully failed to timely report suspicious banking activities of Scott Tucker, its longtime customer, despite being on notice that Tucker had been using the Bank to launder proceeds from an illegal and fraudulent payday lending scheme using a series of sham bank accounts opened under the name of companies nominally owned by various Native American tribes (the “Tribal Companies”). From 2008 through 2012, Tucker’s companies extended approximately five million loans to customers across the country, while generating more than $2 billion in revenues and hundreds of millions of dollars in profits. Most of this money flowed through accounts that Tucker maintained at the Bank.
USB employees responsible for servicing Tucker’s ongoing account activity disregarded numerous red flags that Tucker was using the tribes to conceal his ownership of the accounts. For example, Tucker spent large sums of monies from accounts in the names of Tribal Companies on personal items, including tens of millions of dollars on a vacation home in Aspen and on Tucker’s professional Ferrari racing team. USB also received subpoenas from regulators investigating Tucker’s businesses. In September 2011, after news organizations published reports examining Tucker’s history and questionable business practices, the Bank reviewed Tucker’s accounts, and an AML investigator reported to supervisors, among other things, that “it looks as though Mr. Tucker is quite the slippery individual” who “really does hide behind a bunch of shell companies.” Based on its findings, the Bank closed the accounts in the names of the Tribal Companies but failed to file a SAR.
The Bank also left open Tucker’s non-tribal accounts and opened new ones, allowing over $176 million more from his illegal payday business to flow into the Bank. Despite also learning of an April 2012 Federal Trade Commission lawsuit against Tucker and the Tribal Companies, the Bank did not file a SAR regarding Tucker until served with a subpoena by this Office in November 2013.
On October 13, 2017, Tucker was convicted in the United States District Court for the Southern District of New York of various offenses arising from his payday lending scheme. The Government intends to recommend that the amounts forfeited by USB be distributed to victims of Tucker’s scheme, consistent with the applicable Department of Justice regulations, through the ongoing remission process.
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Mr. Berman praised the outstanding investigative work of the Special Agents at the United States Attorney’s Office and thanked the OCC for its assistance with the investigation. Mr. Berman also thanked FinCEN for its partnership with this Office.
The prosecution is being handled by the Office’s Money Laundering and Asset Forfeiture Unit. Assistant U.S. Attorneys Niketh Velamoor and Jonathan Cohen are in charge of the prosecution. The Office’s Civil Frauds Unit is handling the regulatory action on behalf of FinCEN. Assistant U.S. Attorneys Christopher Harwood and Caleb Hayes-Deats are in charge of the matter.
Manchester Woman Pleads Guilty to Federal Firearms ChargesRead the Press Release
CONCORD, N.H. - Sara Johnson, 35, of Manchester, pleaded guilty in federal court to federal firearms charges, Acting United States Attorney John J. Farley announced today.
According to court documents and statements made in court, Johnson purchased a rifle in a private sale from an individual in New Hampshire sometime in 2015. Johnson subsequently provided the rifle to an individual Johnson knew to be a convicted felon who was prohibited from possessing a firearm.
Johnson also purchased a pistol in 2015 in a private sale in Bow, New Hampshire. At the time of the purchase, the pistol’s serial number was intact. On June 9, 2016, law enforcement officers executed a search warrant at Johnson’s residence. A pistol with an obliterated serial number was found underneath a mattress. Testing later confirmed it to be the same pistol Johnson had purchased in 2015. Possessing a firearm with an obliterated serial number is a violation of federal law.
Johnson is scheduled to be sentenced on May 24, 2018.
“Protecting the community from violent crime is a high priority of the United States Department of Justice,” said Acting U.S. Attorney Farley. “Those who purchase guns for criminals are contributing to the violent crime problem. Along with our law enforcement partners, we will continue to use the Project Safe Neighborhoods initiative to take guns out of the hands of criminals and to protect the safety of our communities.”
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, with assistance from the Manchester Police Department. The case is being prosecuted by Assistant U.S. Attorney Shane B. Kelbley.
The case is part of ATF’s Project Safe Neighborhoods initiative, a federally-funded program intended to reduce gun violence through law enforcement training, public education, and aggressive law enforcement efforts to investigate and prosecute gun-related crimes.
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Manchester Man Pleads Guilty to Fentanyl Trafficking ChargesRead the Press Release
CONCORD, N.H. - Acting United States Attorney John J. Farley announced today that Derrick Jennings, 48, formerly of Manchester, pleaded guilty to fentanyl trafficking charges.
Court documents and statements in court showed that while on supervised release for a prior drug trafficking crime, Jennings sold fentanyl on three separate occasions in January and February 2016, to an individual who was cooperating with the Rochester Police Department. On April 6, 2016, two individuals were arrested by the Manchester Police Department during a traffic stop after a search of the vehicle resulted in the seizure of 244.45 grams of fentanyl that had been packaged for sale. Investigators determined that the individuals were drug “runners” for Jennings. On July 18, 2016, 57.7 grams of fentanyl, a digital scale, multiple cellphones, and $6,100 in cash were recovered when a search warrant was executed at Jennings’ apartment in Manchester. Jennings became a fugitive, but was arrested in November of 2016. The cash was forfeited to the United States.
Jennings pleaded guilty to three counts of distribution of fentanyl, one count of possession of fentanyl with intent to distribute, and one count of conspiracy to distribute fentanyl. He will be sentenced on May 31, 2018.
“The aggressive investigation and prosecution of fentanyl trafficking is a top priority of the United States Attorney’s Office and our law enforcement partners,” said Acting U.S. Attorney Farley. “Individuals like this defendant who seek to profit from the sale of this deadly drug are causing grave damage to our community. We will work tirelessly to stop fentanyl trafficking and to protect the citizens of the Granite State from its deadly effects.”
“Those suffering from the disease of opioid addiction need access to treatment and recovery,” said Drug Enforcement Administration Special Agent in Charge Michael J. Ferguson. “But those responsible for distributing lethal drugs like fentanyl to the citizens of New Hampshire need to be held accountable for their actions. DEA’s top priority is combatting the opioid epidemic by working with our local, county and state law enforcement partners to bring to justice those that distribute this poison.”
This investigation was conducted by the DEA, the Strafford County Drug Task Force, and the Manchester and Rochester, New Hampshire Police Departments. The United States Marshals-led New Hampshire Joint Fugitive Task Force also provided valuable assistance. Assistant United States Attorney Jennifer Cole Davis is prosecuting the case.
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Man Sentenced to over 11 Years in Prison for Drug Trafficking and Firearms OffensesRead the Press Release
Mark Day, 31, of St. Louis, Missouri will serve 138 months in federal prison for possession with intent to deliver heroin and possession of a firearm in furtherance of a drug trafficking crime, the United States Attorney for the Southern District of Illinois, Donald S. Boyce, announced today. Following his prison sentence, Day will be on federal supervised release for 4 years. Day has been in custody since January 4, 2017.
Documents filed in the U.S. District Court establish that on February 26, 2015, Day and a juvenile accomplice were observed by MEGSI officers making hand-to-hand drug deliveries in Washington Park, Illinois. When officers attempted to stop the car driven by the juvenile accomplice, he fled at a high rate of speed and eventually crashed the car into a ditch. Day and the juvenile were arrested. Inside the car and on Day’s person officers found 2,626 capsules of heroin and three loaded firearms which included a Century Arms AK-47 rifle, a Taurus 9 mm semiautomatic handgun that had been stolen, and a Taurus .45 caliber handgun.
The case was investigated by theMetropolitan Enforcement Group of Southwestern Illinois (MEGSI). The case was prosecuted by Assistant United States Attorney Ali Summers.
Man Sentenced to Nearly 22 Years in Federal Prison for KidnappingRead the Press Release
James M. Elbert, III, of Flint was sentenced to 260 months (21⅔ years) in federal prison for kidnapping and being a felon in possession of ammunition, U.S. Attorney Matthew Schneider announced today.
Schneider was joined in the announcement by Jeffery E. Peterson, Acting Special Agent in Charge of the Detroit Division of the Federal Bureau of Investigation (FBI), and George N. Sippert, Chief of Police of the Flint Township Police Department.
U.S. District Court Judge Matthew F. Leitman imposed sentence on James M. Elbert, III, 29, following his guilty plea to kidnapping and felon in possession of ammunition. Because of his prior record, Elbert was designated as an armed career criminal and a career offender, which subjected him to a mandatory minimum sentence of at least 15 years in prison. Judge Leitman also sentenced Elbert to three years of federal supervised release following his term of incarceration.
According to court documents, Elbert, a drug dealer, traveled from Arkansas to Michigan to collect a drug debt from the victim. Elbert and his co-defendant Steven J. Bridges, who were both armed with firearms, kidnapped the victim from a Flint Township apartment complex. Elbert and Bridges then tied the victim up, placed a plastic bag over his head, and transported him to a vacant house in Flint. Once at the vacant house, Elbert and Bridges took the victim to the basement where they tied him to a chair and placed a gag in his mouth, which they secured by wrapping tape around the victim’s head and neck. During the kidnapping, Elbert made telephone calls to the victim’s family threatening to kill to the victim if his debt was not paid. Officers with the Flint Township Police Department ultimately learned of the victim’s location and rescued him before he was subjected to further harm. The victim was transported to a local hospital for treatment and was later released in good condition.“We are focusing on the most violent offenders in the Flint area in order to protect our citizens from violent criminal predators,” Schneider said. “Armed kidnapping is one of the most serious violations of public safety, making people vulnerable in their own neighborhoods. We will bring strong federal penalties against those who prey on citizens all across the Eastern District of Michigan.”
“The FBI is pleased to have assisted the Flint Township Police Department in bringing Mr. Elbert to justice,” said Peterson, Acting Special Agent in Charge, Detroit Division of the FBI. “This incident once again underscores the dangers we face from illegal drugs and the violent crimes that often accompany drug trafficking activities. While dangers remain so long as illegal drugs are on our streets, the public should know that these criminals will not escape the reach of law enforcement, even when they come from hundreds of miles away.”
“This case once again demonstrates the commitment to cooperation between local police agencies and their Federal partners. Law enforcement is most often successful when combining resources. We are grateful for the support of the FBI and the commitment and dedication to our community’s safety exhibited by the efforts of the United States Attorney’s Office,” Chief Sippert said.
The case was investigated by the Flint Township Police Department with assistance from special agents of the FBI. The case was prosecuted by Assistant United States Attorney Anthony P. Vance.
Man Admits Role in Identity Theft and Wire Fraud ConspiracyRead the Press Release
NEWARK N.J. – A Georgia man today admitted using a fake driver’s license in order to obtain a check issued in response to false statements and representations, U.S. Attorney Craig Carpenito announced.
Temilade Adekunle, 30, of Lawrenceville, Georgia, pleaded guilty before U.S. District Judge Kevin McNulty in Newark federal court to an information charging him with one count of aggravated identity theft and one count of conspiracy to commit wire fraud.
According to documents filed in this case and statements made in court:
Adekunle was a member of a conspiracy to fraudulently obtain money, including by committing identity theft, impersonating account holders and obtaining money from their accounts. On Aug. 8, 2017, a member of the conspiracy contacted an entity where an individual (Victim 2) had an account. The caller impersonated Victim 2 and asked to withdraw approximately $85,000 from the account. In response, the entity sent a check through a mail carrier to the account holder’s address.
A member of the conspiracy caused the mail carrier to hold the package containing the check for Victim 2 at one of its branch locations. On Aug. 14, 2017, Adekunle entered the branch and, using a driver’s license with Adekunle’s picture and Victim 2’s name and address, obtained the package containing the check. Sentencing is scheduled for May 30, 2018.
The conspiracy to commit wire fraud charge carries a maximum penalty of 20 years in prison, and a fine of $250,000, or twice the gross gain to the defendant or twice the gross loss to others, whichever is greater. The aggravated identity theft charge carries a sentence of two years in prison, which must be served consecutively to any prison sentence ordered for the conspiracy to commit wire fraud charge, and a fine of $250,000, or twice the gross gain to the defendant or twice the gross loss to others, whichever is greater.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, and the U.S. Department of Labor, Office of Inspector General, under the direction of Special Agent in Charge Michael C. Mikulka in New York, with the investigation leading to today’s guilty plea. He also thanked the Unified Police Department of Greater Salt Lake, Utah, under the direction of Sheriff Rosie Rivera, for its role in the investigation.
The government is represented by Assistant U.S. Attorney Andrew Kogan of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
Defense counsel: Jean Barrett Esq., Montclair, New Jersey
Long Island Home-School Tutor Charged with EnticementRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and James P. O’Neill, the Commissioner of the New York City Police Department (“NYPD”), announced the arrest and the filing of federal charges yesterday against JEFFREY WEBER. The Complaint charges that WEBER communicated with an individual he believed to be a 13-year-old girl via email and text messages, and made plans to meet the girl at a diner in Manhattan and then go to her apartment to engage in sexual activity. WEBER was arrested yesterday when he arrived at the designated meeting place to meet the girl, and was presented before United States Magistrate Judge Debra Freeman in Manhattan federal court.
U.S. Attorney Geoffrey S. Berman said: “As alleged, Jeffrey Weber, a home-school tutor who has constant interaction with children, made arrangements through text messaging and emails to meet with what he thought was a 13-year-old girl to engage in sexual activity. Thankfully he was corresponding with an undercover law enforcement officer and not a young girl, but his alleged intentions are no less insidious. This Office, along with our partners at the NYPD, remain committed to keeping child predators off the streets.”
NYPD Commissioner James P. O’Neill said: “The suspect in this case—a 59-year-old Long Island man—is accused of sending sexually-explicit texts and emails to an investigator posing as a 13-year-old girl. But this crime wasn't confined to cyberspace. The man was arrested yesterday at a diner in Manhattan, where his plan was to meet the underage girl and take her elsewhere for sex. I want to thank the members of the Internet Crimes Against Children Task Force, whose expertise identified and put an end to this predator’s activities.”
According to the allegations in the Complaint filed in Manhattan federal court:[1]
Between January 30, 2018, and February 14, 2018, WEBER, using email and text messages, engaged in sexually explicit communications with a law enforcement agent who was acting in an undercover capacity and posing as a 13-year-old girl. During these communications, WEBER discussed various sexual acts he wished to perform on the girl and made a plan to meet the girl at a diner in Manhattan and to then go to the girl’s nearby apartment for the purpose of engaging in sexual activity. On February 14, 2018, Weber was arrested at the diner where he planned to meet the girl. In an email with who he thought was the 13-year-old girl, WEBER said that he was employed as a tutor, working in the homes of at-risk youth.
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WEBER, 59, of the Seaford, New York, is charged with one count of attempted enticement, which carries a maximum sentence of life in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge
Mr. Berman praised the NYPD’s Computer Crime Squad, which is part of the Internet Crimes Against Children (ICAC) Task Force, for their outstanding investigative work.
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorney Daniel Loss is in charge of the prosecution.
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.