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Tuesday 10 October 2017
Utah Federal, State and Local Government Officials Join Forces to Educate Investors on How to Avoid FraudRead the Press Release
SALT LAKE CITY -- In a new, collaborative effort, Utah federal, state and local government officials established the Financial Fraud Institute and will hold a multi-agency seminar designed to educate Utah investors and consumers on how to recognize and avoid financial and consumer fraud, announced U.S. Securities and Exchange Commission Regional Director Richard R. Best and U.S. Attorney for the District of Utah John W. Huber.
The free seminar is open to the public and will be held in St. George on Nov 2. Follow us on Twitter at #StopFraudUtah.
Officials from the U.S. Securities and Exchange Commission, U.S. Attorney’s Office, Utah Attorney General’s Office, Financial Industry Regulatory Authority (FINRA), Utah Division of Securities, Utah Division of Consumer Protection, FBI, IRS and the Washington County Attorney’s office will participate in the seminar.
John Huber, United States Attorney for the District of Utah, will be the keynote speaker at the seminar. This is the third in a series of seminars as a part of the Financial Fraud Institute initiative.
The seminar will provide information on key questions to ask before making investment decisions, where to find free and unbiased information, how to spot financial scams, and how to report suspected fraud.
WHO: National and local experts from federal and state law enforcement and financial regulatory agencies
WHAT: Financial Fraud Institute Seminars to educate investors and consumers on how to recognize and avoid fraud
WHEN: November 2, 2017
4:00 p.m. – 7:00 p.m. (
See agenda here )WHERE: The Dixie Center
1835 Convention Center Drive
St. George, UT
Those interested in attending the seminar must register at: www.utfraud.com, or call 801-579-6191. For more information, visit www.utfraud.com.
The seminar is open to the press. Press interested in attending the event should contact Melodie Rydalch of the Utah U.S. Attorney’s Office on 801-243-6475 or [email protected].
Us Postal Inspection Service Arrests Individual for Theft of Four Generators from the Us Postal ServiceRead the Press Release
SAN JUAN, Puerto Rico – United States Magistrate Judge Silvia Carreño-Coll authorized a criminal complaint against Christian Joel Encarnación-Sandoval, charging him with theft of mail, said U.S. Attorney Rosa Emilia Rodríguez-Vélez for the District of Puerto Rico. The U.S. Postal Inspection Service in charge of the investigation.
According to the criminal complaint, on October 7, 2017 Postal Inspectors where informed by Postal Management that at Cargo Force (a facility at San Juan Airport that unloads US mail from incoming planes) an individual, later identified as Encarnación-Sandoval was found to be in possession of four power generators stolen from the mail stream.
Postal Inspectors were notified that there was suspicious activity in the loading dock. When the officials arrived, found Encarnación-Sandoval shirtless, acting suspiciously and with nervous behavior. The officials observed one generator on the front passenger of the defendant’s car and two generators on the rear passenger seat of the vehicle. The generators were in sealed boxes that had US Postage Validated Imprint indicating that they are US mail. There was another parcel containing a generator in the trunk of the car.
If convicted defendant faces up to five years of imprisonment and a $250,000 fine, as well as a period of supervised release of not more than three years. A criminal complaint contains only charges and is not evidence of guilt. A defendant is presumed to be innocent unless and until proven guilty. Assistant U.S. Attorney Marc S. Chattah has been assigned to prosecute this case.
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United States Citizenship and Immigration Services Officer Sentenced to Prison for Accepting a BribeRead the Press Release
United States Citizenship and Immigration Services Officer Jovany Perez, 34, of Miami, Florida, was sentenced to 48 months imprisonment following his conviction for receiving a bribe while a public official.
Benjamin G. Greenberg, Acting U.S. Attorney for the Southern District of Florida, and Jay Donly, Special Agent in Charge, Department of Homeland Security, Office of the Inspector General (DHS-OIG), made the announcement.
According to the evidence, on April 20, 2017, Perez interviewed a female alien beneficiary in his capacity as a United States Citizenship and Immigration Services (“USCIS”) officer assigned to adjudicate her immigration application. The interview related to the validity of the beneficiary’s marriage, which would have afforded her lawful permanent residency in the United States if found to be valid. During the interview, Officer Perez confronted the beneficiary with his belief that her marriage was fraudulent. Perez completed and directed the beneficiary to sign a written statement, purporting to be a confession by beneficiary that she had committed marriage fraud. At the conclusion of the interview, Perez provided the beneficiary with his contact information and told her that he could help her with her case, but could not do so at the USCIS office.
Later that same day, the beneficiary contacted Perez and they scheduled to meet later that day in the parking lot of a restaurant located in Miami-Dade County. During the meeting, while sitting with the beneficiary in his vehicle, Perez fondled the beneficiary’s breasts, asked her whether she was wearing a wire, and exposed his penis to her. Perez explained to her that he was the ultimate decision maker in her case, and stated that the two could have a sexual encounter there in the vehicle. The beneficiary declined and the two agreed to meet on a later date.
On May 9, 2017, the beneficiary met with Perez and Perez informed her that he possessed her file, that he would remove her written statement from the file, and that he would replace it with another statement that he would help her draft. When the beneficiary asked Perez what she would have to do in exchange for his assistance, Perez stated that if she did not want to exchange sex, she could pay him money. The two agreed that the beneficiary would pay Perez $2,000.00 in exchange for his assistance.
On May 17, 2017, Perez accepted $2,000.00 from the beneficiary, in return for his promise to remove the previously-written statement regarding the validity of her marriage and replace it with a statement to assist her permanent residency petition. Perez was arrested that same day, and was charged by Complaint and then Indictment of Receiving a Bribe in violation of 18 U.S.C., Section 201(b)(2)(A).
On July 26, 2017, Perez pled guilty to the Receiving a Bribe charge in the Indictment.
On October 6, 2017, Perez was sentenced to a four-year term in prison, followed by a three-year term of supervised release.
Mr. Greenberg commends the investigative efforts of the DHS-OIG. This case was prosecuted by Special Assistant United States Attorneys Michele S. Vigilance and Monica V. Atkins and Assistant United States Attorney Jessica Kahn Obenauf.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Two defendants sentenced to federal prison for heroin chargesRead the Press Release
HUNTINGTON, W.Va. – Two defendants who pleaded guilty earlier this year to federal drug crimes were sentenced today in Huntington, announced United States Attorney Carol Casto. Bradley William McCutchen, 36, of Detroit, was sentenced to five years in federal prison after previously pleading guilty to possession with intent to distribute 100 grams or more of heroin. In a separate prosecution, Judy Kay Smith, 59, of Huntington, was sentenced to a year and three months in federal prison and ordered to pay a $10,000 fine after previously pleading guilty to distributing heroin.
On March 28, 2015, agents with the Drug Enforcement Administration Task Force executed a search warrant at “The Sandwich Joint,” a restaurant located at 417 12th Street in Huntington. Agents had previously purchased heroin at the restaurant on several occasions. During the search, agents located and seized over 275 grams of heroin from a safe located on the second floor of the restaurant. Agents also seized various items of drug paraphernalia during the search, including packaging material, a digital scale, and multiple bottles of inositol powder, which is commonly used as a cutting agent in the preparation of heroin for distribution. McCutchen admitted that he used the restaurant to store heroin that he supplied to other individuals and distributed himself. McCutchen further admitted that between August 2014 and March 2015, he supplied the owner of the restaurant with heroin that he transported to Huntington from Detroit.
In a separate prosecution, deputies with the Cabell County Sheriff’s Department utilized a confidential informant to make a controlled purchase of heroin from Smith on January 5, 2017. Smith agreed to meet the informant in a parking lot at 4341 U.S. Route 60 in Huntington to complete the drug deal. After the informant and Smith arrived at that location, the informant entered Smith’s vehicle, where she sold the informant approximately 10 grams of heroin in exchange for $1,200 in cash. Smith also admitted that she distributed 20 grams of heroin to the informant on January 9, 2017.
On January 23, 2017, Smith agreed to distribute 20 grams of heroin to an undercover agent with the Huntington FBI Drug Task Force. Prior to that drug deal, a trooper with the West Virginia State Police conducted a traffic stop of Smith’s vehicle. Smith was arrested and found with approximately 22 grams of heroin. Agents also executed a search warrant at Smith’s residence and seized additional heroin and two firearms. As part of her plea, Smith agreed to forfeit a vehicle that was used to facilitate the heroin trafficking.
The Drug Enforcement Administration Task Force conducted the McCutchen investigation. The Huntington FBI Drug Task Force, the Cabell County Sheriff’s Department, and the West Virginia State Police conducted the Smith investigation. Assistant United States Attorney Joseph F. Adams handled the prosecutions. United States District Judge Robert C. Chambers imposed the sentences.
These prosecutions are part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
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Two Individuals Charged with Securities Fraud, Money Laundering and Obstruction in Connection with Scheme to Secretly Profit from Fraudulent Stock Sales and Conceal Proceeds from the United States District Court for the Eastern District of New YorkRead the Press Release
Two individuals were charged with securities fraud, money laundering and obstruction of justice offenses in connection with a scheme to sell fraudulently registered shares of public companies and to hide and conceal these activities and the proceeds from the United States District Court for the Eastern District of New York. This case is part of the ongoing Shell Factory Fraud criminal investigation.
Randy A. Hummel, Executive Assistant United States Attorney, U.S. Attorney’s Office for the Southern District of Florida, and Timothy R. Langan, Acting Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, made the announcement.
Myron Gushlak, 47, a Canadian citizen who formerly resided in Miami Beach and the Cayman Islands, and Yelena Furman, a/k/a “Elena Furman,” 36, of New York, were charged by indictment with conspiracy to commit securities fraud, in violation of Title 18, United States Code, Section 1349; five counts of securities fraud, in violation of Title 18, United States Code, Section 1348; conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956(h); two counts of money laundering, in violation of Title 18, United States Code, Section 1956(a)(1)(B)(i); and, obstruction of official proceeding, in violation of Title 18, United States Code, Section 1512(c)(2). The defendants face a maximum statutory sentence of twenty-five years for the conspiracy and securities fraud counts, twenty years each for the conspiracy to commit money laundering and money laundering counts, and twenty years for the obstruction count, as well as a fine up to $250,000 or double the proceeds as to each. The case is No. 17-CR-20713-CMA and is assigned to U.S. District Judge Cecilia M. Altonaga in Miami.
In related cases, seven defendants have been charged to date: Daniel McKelvey, 49, of Foster City, California, and Jeffrey L. Lamson, 51, of El Dorado Hills, California, were charged in Case No. 16-20546-CR-RNS; Steven Sanders, 73, of Lake Worth, Florida, and Alvin S. Mirman, 78, of Sarasota, Florida, were charged in Case No. 16-20572-CR-CMA; Sheldon Rose, 77, of Sarasota, and Ian Kass, 45, of Ft. Lauderdale, in Case No. 16-20707-CR-JEM, and David Lubin, 52, of West Hempstead, New York, in Case No. 17-20508-CR-MGC. All seven of these defendants were convicted. Six of the seven have already been sentenced, and sentencing for Lubin is scheduled for November 2, 2017, before U.S. District Judge Marcia G. Cooke in Miami.
The indictment alleges that Gushlak was convicted of conspiracy to commit securities fraud and conspiracy to commit money laundering in Case No. 03-833-CR-NGG in the United States District Court for the Eastern District of New York (the “EDNY Criminal Case”). On November 18, 2010, the court sentenced Gushlak to 72-months imprisonment and ordered him to pay a $25 million fine due immediately. After lengthy restitution proceedings, on May 15, 2012, the court ordered Gushlak to additionally pay restitution of approximately $17.4 million, also due immediately.
The indictment alleges that while Gushlak was on bond in the EDNY Criminal Case leading up to his November 2010 sentencing, and while he was serving his prison sentence, Gushlak, Furman, Lubin, and others participated in a scheme to fraudulently register and sell securities of public shell companies. This included the fraudulent filing of documents with the U.S. Securities and Exchange Commission (SEC), using the sister-in-law of Furman as a nominee chief executive officer (CEO). This was done, according to the indictment, to conceal the role of Gushlak and his control over shares that were purportedly owned in the names of others. The indictment alleges that these shares were then sold to other co-conspirators who were located in Miami-Dade and Broward Counties, Florida, and that the shares were then illegally sold to the investing public.
In another instance, according to the indictment, after Gushlak was sentenced to federal prison and serving his sentence, Gushlak, Furman, Lubin, Sanders, McKelvey and Lamson worked together to fraudulently sell the free-trading shares of Entertainment Art, Inc. (“EERT”). The allegations include meetings with Gushlak while he was serving his federal prison sentence at which the conspirators discussed the details of the fraudulent transactions. After causing false and fraudulent flings with the SEC, the shares were then sold to criminal actors. These criminal actors were then in a position to conduct a significant pump and dump stock swindle involving Biozoom, Inc. (“BIZM”) after causing a reverse merger of EERT into BIZM.
The indictment alleges that, because Gushlak’s assets were frozen by the United States District Court in the EDNY Criminal Case, and he had been ordered to pay a $25 million fine and restitution of approximately $17.4 million, Gushlak, Furman, Sanders and others engaged in elaborate steps to hide and conceal the proceeds of these stock sales from the United States District Court in Brooklyn, New York. According to the indictment, Gushlak and Furman enlisted the assistance of Sanders and others to use the trust account of an attorney in Boca Raton, Florida, to wire the funds in such a way that they would be difficult or impossible to attribute to Gushlak. This included wiring funds to an intermediary in Switzerland and to an account controlled by Furman in New York that was used to pay Gushlak’s bills while he was in prison.
Mr. Hummel commended the investigative efforts of the FBI’s Miami and New York Field Offices. Mr. Hummel also thanked the SEC’s Miami Regional Office and Washington Home Office for their assistance with the ongoing Shell Factory Fraud investigation. This matter is being prosecuted by Assistant U.S. Attorney Jerrob Duffy.
An indictment merely contains allegations and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Third Baltimore City Police Detective Pleads Guilty to Racketeering ConspiracyRead the Press Release
FOR IMMEDIATE RELEASE Contact ELIZABETH MORSE
www.justice.gov/usao/md at (410) 209-4885
Baltimore, Maryland – Detective Jemell Lamar Rayam, age 37, of Owings Mills, Maryland, pleaded guilty today to one count of racketeering conspiracy including multiple robberies, and overtime fraud.
The guilty plea was announced by Acting United States Attorney for the District of Maryland Stephen M. Schenning and Special Agent in Charge Gordon B. Johnson of the Federal Bureau of Investigation, Baltimore Field Office.
Rayam joined the Baltimore Police Department on July 12, 2005 and was later assigned to the Gun Trace Task Force (GTTF,) a division of the Baltimore Police Department. According to the plea agreement, Rayam schemed to steal money, property, and narcotics by detaining victims, entering residences, conducting traffic stops, and swearing out false search warrant affidavits. In addition, Rayam prepared and submitted false official incident and arrest reports, reports of property seized from arrestees, and charging documents. The false reports concealed the fact that Rayam and his co-conspirators had stolen money, property, and narcotics from individuals.
According to his plea agreement, beginning in 2009, Rayam robbed civilians he detained and in some cases arrested and stole money and drugs from them. Rayam shared the proceeds with co-defendants Momodu Gondo, Wayne Jenkins, Daniel Hersl, Marcus Taylor, and others, and on other occasions, he kept all of the proceeds for himself. Rayam also sold, through associates of his, drugs that Jenkins stole from detainees and arrestees, gave them to Rayam, and split the proceeds of those sales with his co-defendant.
Rayam participated in 15 robberies from June 2014 through October 2016. Rayam admitted that he was armed with his BPD service firearm during the robberies, that individual victims of the robberies were physically restrained to facilitate the commission of the offense, and that he authored false and fraudulent incident reports and other official documents in some cases in order to conceal his criminal conduct and otherwise obstruct justice.
Rayam also robbed detainees and arrestees with another police officer, who was not a member of the GTTF. Rayam and this other police officer would falsely represent that they had a search warrant, when they did not, in order to gain access to someone’s home and would then steal money and other things of value. In addition, Rayam had an associate who would inform him when a drug dealer had a significant amount of cash in his home and when the associate knew that the drug dealer would not be in the home. Rayam would then rob the drug dealer’s home with the assistance of other associates of his who were not police officers.
On October 5, 2016, Rayam and his co-conspirators robbed a drug dealer after he and Gondo placed a tracking device on the victim’s car without court authorization so that they could rob his apartment when he was not home. Rayam and Glen Kyle Wells entered the victim’s apartment. Rayam was wearing a ski mask and was armed with a BPD-issued firearm. Rayam and Wells stole a Rolex watch, a firearm, $12,000 to $14,000 in cash, and at least 800 grams of heroin. After the robbery, Rayam and his co-conspirators split the money they had stolen. Wells took the drugs and money, and Wells sold some of the drugs and gave Rayam a portion of the proceeds. Wells then gave Rayam a quantity of drugs that he had been unable to sell, which Rayam in turn sold through an associate.
On June 27, 2014, Rayam and his co-defendants executed a search and seizure warrant at a store that sold birdseed. No illegal contraband or firearms were found at the location. The storeowners, a married couple, had $20,000 in cash at the store that they intended to use to pay off tax liabilities they owed on two homes. Rayam later contacted two associates and agreed to rob the home of the storeowners. The associates presented themselves as police officers and stole $20,000, while Rayam remained in the car so he could intercept the police officers that responded to the incident by pretending to respond to the incident himself. Rayam split the proceeds with his associates.
On March 11, 2015, Rayam, Gondo and Sergeant A, as well as Sergeant A’s son, who was not a police officer, searched a residence and discovered a large quantity of cash. Rayam, Gondo and a BPD Sergeant each took some of the cash. Rayam took between $8,000 and $10,000. Sergeant Thomas Allers has been charged in a separate indictment with Racketeering Conspiracy and Racketeering. Allers is detained pending trial.
On July 8, 2016, Rayam and his co-defendants Hersl and Gondo detained two victims after a car stop. Rayam stole money from one of the victims. At Jenkins’s direction, Hersl, Rayam, and Gondo transported the two victims to a BPD office to interrogate them. Jenkins told his co-conspirators to treat him like he was the U.S. Attorney. After speaking with one of the individuals, Jenkins, Hersl, Gondo, and Rayam then transported both of the victims to their home and robbed them of $20,000. Jenkins, Hersl, Rayam, and Gondo divided the $20,000. Rayam authored a false incident report to conceal the stolen money, which Jenkins approved.
In the fall of 2016, Jenkins approached Rayam and asked him to sell drugs that Jenkins had stolen from detainees. Rayam agreed and sold the drugs Jenkins gave him and shared the proceeds with Jenkins. Jenkins maintained that Rayam owed him money for drugs that Jenkins had given him. After seizing a firearm and marijuana, Jenkins told Rayam to sell the firearm and marijuana in order to pay Jenkins for money that Jenkins believed Rayam owed him. Gondo subsequently arranged for an associate of his, who was a drug dealer, to buy the firearm and marijuana. That associate of Gondo’s gave Rayam money for the sale of the firearm and marijuana.
According to the plea agreement, Rayam also admitted that he routinely submitted false and fraudulent individual overtime reports defrauding the Baltimore Police Department and the citizens of the State of Maryland. On these reports, Rayam falsely certified that he worked his entire regularly assigned shifts, when he did not, and that he worked additional hours for which he received overtime pay, when he had not worked all and in some cases any of those overtime hours. Rayam also admitted that he submitted false and fraudulent overtime reports on behalf of his co-defendants.
Lastly, Rayam admitted to obstructing law enforcement by alerting his co-defendants about potential investigations of their criminal conduct, coaching each another to give false testimony to investigators from the Internal Investigations Division of the BPD, and turning off his body cameras to avoid recording encounters with civilians.
Rayam faces a maximum sentence of 20 years in prison.
Acting United States Attorney Stephen M. Schenning commended the FBI for its work in the investigation. Mr. Schenning thanked Assistant U.S. Attorneys Leo J. Wise and Derek E. Hines, who are prosecuting this Organized Crime Drug Enforcement Task Force case.
Theodore Resident Sentenced to 42 Months for Being a Felon in PossessionRead the Press Release
United States Attorney Richard W. Moore of the Southern District of Alabama announces today that United States District Judge William H. Steele sentenced David Lee Wesley, 60, of Theodore, Alabama, to 42 months imprisonment. The judge ordered that Wesley pay a $100 special assessment, undergo three years of supervised release after completing his prison term, and participate in drug and/or alcohol treatment as directed by the United States Probation Office.
In December 2016, law enforcement officials learned that Wesley, aka “Bubba,” was allegedly selling crack cocaine from his home in Theodore. On December 13, 2016, a confidential informant, acting under the supervision of law enforcement officials, purchased roughly one gram of crack cocaine from Wesley at his home. On December 16, 2016, Mobile County Sheriff’s Office Deputy Ronald Moody obtained a state warrant to search the premises. On December 21, 2016, government agents executed the warrant at Wesley’s home and found, among other items, a .38 Ultra Lite Special Revolver loaded with five rounds of live ammunition, a single shot Stevens Model Number 940 B shotgun, a Marlin .22-caliber rifle with one magazine and one live round, and one silver pipe with suspected crack cocaine. Law enforcement officials Mirandized Wesley, who admitted that he possessed the firearms. Wesley has several prior felony convictions, which prohibit him from knowingly possessing any firearms or ammunition.
In February 2017, a federal grand jury for the Southern District of Alabama charged Wesley with being a felon in possession. On June 29, 2017, Wesley pleaded guilty to the offense before Judge Steele.
The Mobile County Sheriff’s Office and the Federal Bureau of Investigation investigated the case. Assistant United States Attorneys Maria Murphy and Sinan Kalayoglu prosecuted the case.
Tennessee Woman Convicted of Stolen ID Refund FraudRead the Press Release
An Antioch, Tennessee, woman was convicted today by a federal jury sitting in Nashville, Tennessee, of eight counts each of wire fraud and aggravated identity theft, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Donald Q. Cochran for the Middle District of Tennessee.
According to the indictment and evidence presented at trial, in January and February 2012, Monique Ellis, used stolen IDs, including those of prisoners held by the Alabama Department of Corrections, to file tax returns with the Internal Revenue Service (IRS) seeking fraudulent refunds. Ellis directed the fraudulently obtained refunds to bank accounts that she controlled, causing a tax loss of $121,851.10.
Sentencing is scheduled for Jan. 9, 2018 before U.S. District Court Judge Gershwin A. Drain. Ellis faces a statutory maximum sentence of 20 years in prison for each count of wire fraud and a mandatory two year sentence for each count of aggravated identity theft. She also faces a period of supervised release, restitution, and monetary penalties.
Acting Deputy Assistant Attorney General Goldberg and U.S. Attorney Cochran thanked special agents of IRS Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Henry Leventis, and Trial Attorney Lauren Castaldi of the Tax Division, who are prosecuting this case.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
Tahlequah Man Sentenced to 120 Months for Firearm PossessionRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that SAMUEL NOLAN DOTY, age 47, of Tahlequah, Oklahoma, was sentenced to 120 months imprisonment to run consecutive to a 7 year state prison sentence out of Cherokee County, Oklahoma for being a Felon in Possession of a Firearm, and 10 years of supervised release for POSSESSION OF CERTAIN MATERIAL INVOLVING THE SEXUAL EXPLOITATION OF MINORS, in violation of Title 18, United States Code, Sections 2252(a)(4)(B) and 2252(b)(2).
The Indictment alleged that between on or about April 17, 2014, and on or about August 24, 2016, in the Eastern District of Oklahoma, the defendant, did knowingly possess, attempt to possess and access with intent to view matters which contained visual depictions, as that term is defined in Title 18, United States Code, Section 2256(5), the production of said visual depictions involved the use of minors engaging in sexually explicit conduct, as that term is defined in Title 18, United States Code, Sections 2256(2)(A)-(B), and said visual depictions were of such sexually explicit conduct and had been transported in interstate commerce by computer.
The charge arose from an investigation by the Cherokee County Sheriff’s Office, the United States Marshal’s Service, and the Federal Bureau of Investigation. U.S. Attorney Brian J. Kuester said, “I commend the hard work of the county and federal law enforcement agencies that worked together. Without thorough investigations this agency would not have the ability to successfully prosecute cases.”
The Honorable James H. Payne, U.S. District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearing. The defendant will remain in custody pending transportation to the designated federal facility at which the nonparoleable sentence will be served.
Assistant United States Attorney Edward Snow represented the United States.
Statement of Acting United States Attorney David C. Weiss on the Wilmington Trust Corporation SettlementRead the Press Release
"Wilmington Trust Company (WT) has been a fixture in this community for more than 100 years. This is why the bank’s decline and the fire sale acquisition by M&T Bank was such a significant development in this community; and why this office has invested substantial time, energy and resources in the investigation and prosecution of this case.
The United States Attorney’s Office fort the District of Delaware has reached a resolution with WT. The key terms, from our perspective, are as follows:
- WT admits that it agreed to submit Monthly Regulatory Reports to the Federal Reserve between October 2009 and July;
- Those reports included past due loan information.
- The past due loan numbers submitted to the Federal Reserve did not include past due loans that WT chose to “waive.”
We say that those monthly reports were false. These facts and those set forth in the Civil Forfeiture Complaint filed earlier today, provide a basis to forfeit the proceeds of this unlawful activity.
- As a result, WT and the USAO have agreed to a total settlement amount of $60,000,000, which credits WT with its prior payment to the SEC in the amount of $16,000,000, and requires an additional forfeiture payment of $44,000,000.
- Further, WT agrees to cooperate with the USAO moving forward. In return, the USAO has agreed to dismiss all criminal charges pending against WT, and the parties have agreed to exchange mutual releases.
To function effectively, our financial markets require accurate disclosures—and regulators need to receive accurate information.
That didn’t happen here.
We believe today’s resolution accomplished three important objectives. First, we secured a substantial payment for victims who sustained losses as a result of what transpired. Second, WT accepted responsibility for its actions. And third, if possible, we wanted to avoid the collateral consequences of a criminal conviction for the bank, which could have resulted in the loss of jobs and revenue for our community."
St. Louis Man Pleads Guilty to Possession of an Unregistered Pipe BombRead the Press Release
Donald S. Boyce, United States Attorney for the Southern District of Illinois, announced today that Paul Ryan Owens, 30, St. Louis, Missouri, pled guilty on Friday, October 6, 2017, to unlawful receipt and possession of an unregistered destructive device, the offense occurring on July 28, 2017, in Madison County, Illinois. Owens faces up to ten years of imprisonment, three years of supervised release, a $250,000 fine, and a $100 special assessment.
According to court documents, beginning on July 20, 2017, through the time of his arrest on July 28, 2017, Owens solicited a pipe bomb, specifying that he wanted it to be four inches in length with hardened steel end caps containing black powder with a one and a half to two feet long fuse. On July 28, 2017, Owens accepted a toolbox containing a pipe bomb constructed by an ATF bomb expert in such a manner that it would only smoke if detonated. Owens had not registered the pipe bomb in the National Firearms Registration and Transfer Record. Owens looked into the toolbox and indicated that the pipe bomb was as he requested and provided morphine pills in exchange for the pipe bomb. Law enforcement immediately arrested Owens.
The investigation of Owens was conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Hamel Police Department.
Schuylkill County Man Guilty of Participating in A Heroin and Methamphetamine Trafficking ConspiracyRead the Press Release
SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced that Derek Mountz, age 33, pleaded guilty today before Senior U.S. District Court Judge A. Richard Caputo, to participating in a conspiracy to distribute heroin and methamphetamine in Schuylkill and Berks Counties.
According to United States Attorney Bruce D. Brandler, Mountz admitted to conspiring with others to distribute more than 100 grams of heroin (which is equivalent to more than 4,000 retail bags of heroin) and more than 50 grams of methamphetamine during April through October of 2016.
Mountz was indicted by a federal grand jury in January 2017, as a result of an investigation by the Federal Bureau of Investigation, the Pennsylvania State Police, and local police in Schuylkill County. Assistant U.S. Attorney Francis P. Sempa is prosecuting the case.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for this offense is 40 years’ imprisonment, a term of supervised release following imprisonment, and a fine. There is also a mandatory minimum sentence of five years’ imprisonment for the offense. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Schenectady Man Sentenced for Possession of Handgun as a Convicted FelonRead the Press Release
ALBANY, NEW YORK – Tameen “Nitty” Johnson, 39, of Schenectady, New York, was sentenced today to serve 235 months in prison for illegally possessing a loaded handgun as a prior convicted felon. Senior U.S. District Judge Thomas J. McAvoy also ordered that Johnson serve a five-year term of supervised release following his release from federal prison.
The announcement was made by Acting United States Attorney Grant C. Jaquith and Vadim D. Thomas, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).
After a three-day jury trial in January 2017, Johnson was convicted of possessing a Hi-Point JCP .40 caliber firearm loaded with seven rounds of .40 caliber ammunition. The evidence at trial established the handgun had a defaced serial number and that Johnson provided it to another man inside a convenience store in Schenectady in exchange for $200. Johnson, after asking if the firearm would be used “to book somebody,” showed the man how to operate the firearm so that he could “handle his business,” and repeatedly warned him not to lose the “hammer.”
Johnson, who was charged as an Armed Career Criminal because he has at least three previous convictions for serious drug offenses or violent felonies, faced a mandatory minimum sentence of fifteen years in prison and a maximum sentence of life imprisonment. Johnson’s prior criminal history includes prior felony convictions for drug offenses, attempted robbery, attempted burglary, and assault.
This prosecution resulted from an investigation by the Capital District Safe Streets Task Force, which includes members of the FBI, Bureau of Alcohol, Tobacco, Firearms & Explosives, the New York State Police, the Schenectady Police Department, the Schenectady County District Attorney’s Office, the New York State Department of Corrections and Community Supervision, the Albany County Sheriff’s Office, and the New York Air National Guard.
The case was prosecuted by Assistant United States Attorney Wayne A. Myers.
Robert J. Higdon, Jr. Sworn in as United States AttorneyRead the Press Release
RALEIGH – Robert J. Higdon, Jr. has taken the oath of office to become the United States Attorney for the Eastern District of North Carolina. Mr. Higdon was nominated by President Donald Trump on August 2, 2017 and confirmed by the United States Senate on September 28, 2017. He took the oath of office from Chief United States District Judge James C. Dever.
Mr. Higdon stated, “It is an honor and a privilege to serve the people of the Eastern District of North Carolina as United States Attorney. I am grateful to President Trump for this opportunity and I want to thank Senators Richard Burr and Thom Tillis for their strong support though the confirmation process.”
As U.S. Attorney, Mr. Higdon is the top-ranking federal law enforcement official in the Eastern District of North Carolina, which includes the 44 eastern most counties of North Carolina. He oversees a staff of 108 employees, including 51 attorneys and 57 non-attorney support personnel. The office is responsible for prosecuting federal crimes in the district, including crimes related to terrorism, public corruption, child exploitation, firearms, and narcotics. The office also defends the United States in civil cases and collects debts owed to the United States.
Mr. Higdon, a Greensboro native, spent nearly 24 years as a federal prosecutor, including serving as an Assistant United States Attorney in both the Western and Eastern Districts of North Carolina. He has supervised and prosecuted a wide range of criminal cases, including narcotic traffickers, white collar and public corruption matters, mail and wire fraud, bribery, false statements, Foreign Corrupt Practices, violations of the Federal Election Campaign Act, violations of import/export regulations, money laundering, theft of government property and violations involving government contracting and programs. Mr. Higdon has been involved in a number of high-profile cases, including the investigation and resolution of violations by a private security firm, a criminal investigation that returned North Carolina's Original Copy of the Bill of Rights to the State more than 130 years after it was stolen by Federal Troops, the prosecution of numerous public officials in North Carolina and in other states and was co-lead counsel in the prosecution of former United States Senator and former Presidential candidate John Edwards.
Mr. Higdon received his J.D. in 1989 from the Wake Forest University School of Law and his B.A. in 1985 from Wake Forest University. He is a member of the North Carolina State Bar and the State Bar of Georgia.
Raleigh Man Who is a Convicted Sex Offender Sentenced to 20 Years for the Receipt of Child PornographyRead the Press Release
GREENVILLE – United States Attorney Robert J. Higdon, Jr. announced that today in federal court, Senior United States District Judge Malcolm J. Howard sentenced THOMAS PAUL KEELER, II, 48, from Raleigh to 240 months in prison, lifetime of supervision upon release and a $5,000.00 fine for the Receipt of Child Pornography (CP). KEELER pled guilty to the charge on May 12, 2017.
On February 26, 2016, the Homeland Security Investigation (HSI) in Tampa, Florida contacted HSI in Raleigh utilizing an unidentified smart phone to post child pornography (CP) in several chatrooms. After identifying the subscriber of the chatroom, an undercover agent (UC), posing as the father of a 13-year-old female, subsequently contacted the individual.
The perpetrator’s chat conversations were graphic and explicit in nature as he repeatedly expressed a desire to meet the UC and his fictional 13-year-old daughter in person. He and the UC subsequently arranged a meeting at the Red Roof Inn (RRI) in Cary, North Carolina. The suspect made it clear through his chat conversations that his intentions were to engage in sexually prohibited conduct with the 13-year-old female. Agents located the suspects profile page and utilized facial recognition software to identify THOMAS PAUL KEELER, II, a registered sex offender, as the individual utilizing the chatroom.
On March 24, 2016, agents arrested KEELER as he entered the RRI parking lot. A search of KEELER’s vehicle incident to his arrest uncovered a condom and a pair of handcuffs. Additionally, the defendant’s smartphone was seized. Subsequent to his arrest, KEELER provided an unprotected statement to authorities. Specifically, the defendant acknowledged being previously arrested and convicted of Transportation of Child Pornography; however, he noted that he pulled into the RRI parking lot in order to send a text to a friend.
A search warrant was executed on KEELER’s residence where agents seized two computers, a hard drive, and a flash drive. Additionally, several pairs of women’s underwear and multiple sex toys were located. A forensic preview of the defendant’s smartphone revealed multiple groups in a chatroom utilized for CP, related to the distribution of CP. Investigation confirmed the defendant acted as an administrator for one group that traded CP. In order to become a member of the group, an individual was required to post an image of CP or he/she was banned from entering the group. KEELER also distributed/traded CP via a Dropbox account to members in the chat group. Agents found 51 videos containing CP in Dropbox links. Investigation also revealed KEELER engaged in multiple chat conversations with “young girls” between August 8, 2015, and March 24, 2016.
Forensic examination of KEELER’s smartphone and computer equipment revealed at least 1,433 images of CP and 470 videos containing CP. KEELER’s collection of CP contained images and videos of infants. Furthermore, several videos depicted sadistic or masochistic conduct or other depictions of violence.
KEELER was previously convicted of Transportation of Child Pornography in Interstate Commerce in this District on September 5, 2000.
The case was investigated by Homeland Security Investigations (HSI) and the Cary Police Department. The federal prosecution was handled by Assistant United States Attorney Ethan A. Ontjes.
This case was part of the Project Safe Childhood initiative, a national program aimed at ensuring that criminals exploiting children are effectively prosecuted by making full use of all available law enforcement resources at every level. For more information about this important national project, Project Safe Childhood, go to www.projectsafechildhood.gov.
Pittsburgh Man Charged with Heroin and Fentanyl Trafficking, Firearms ViolationsRead the Press Release
PITTSBURGH – Michael Ginyard, Jr. has been indicted by a federal grand jury in Pittsburgh for heroin and fentanyl trafficking and committing related firearm crimes, Acting United States Attorney Soo C. Song announced today.
The indictment charges Ginyard Jr., age 30, with committing the following crimes in January and February 2017: (1) possession of heroin and/or fentanyl with intent to distribute, (2) attempt to distribute heroin, (3) possession of a firearm and/or ammunition after five felony convictions for heroin and cocaine trafficking, and (4) possession of a firearm in furtherance of a drug trafficking crime.
The law provides for a maximum total sentence of at least 20 years and up to life in prison and a fine of up to $6,750,000. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history of the defendant.
Assistant United States Attorney Craig W. Haller is prosecuting this case on behalf of the United States.
This case is being prosecuted under Project Safe Neighborhoods, a collaborative effort by federal, state and local law enforcement agencies, prosecutors and communities to prevent, deter and prosecute gun crime. The Pittsburgh Bureau of Police, the Federal Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Penn Hills Police Department conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Pittsburgh Felon Charged with Illegally Possessing Pistol and AmmunitionRead the Press Release
PITTSBURGH – A resident of Pittsburgh, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on a charge of violating the federal firearms laws, Acting United States Attorney Soo C. Song announced today.
The one-count indictment named Deondre Steave, age 24.
According to the indictment, on or about September 28, 2017, Steave, an individual with prior felony convictions for Conspiracy to Possess with the Intent to Distribute 100 Grams or More of Heroin and Escaping from Federal Custody, did knowingly and unlawfully possess a Kahr CW .40 caliber pistol and ammunition. Federal law prohibits anyone who has been convicted of a crime punishable by a term of imprisonment exceeding one year from possessing a firearm or ammunition.
For Steave’s offense, the law provides for a maximum total sentence of not more than 10 years in prison, a fine of not more than $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history of the defendant.
Assistant United States Attorney Brendan T. Conway is prosecuting this case on behalf of the government.
The Pittsburgh Bureau of Police and the Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation leading to the indictment in this case. This case is being prosecuted under Project Safe Neighborhoods, a collaborative effort by federal, state and local law enforcement agencies, prosecutors and communities to prevent, deter and prosecute gun crime.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Pennsylvania Man Admits Kickback Conspiracy Involving Military Parts for the U.S. NavyRead the Press Release
NEWARK, N.J. – The assistant purchasing manager for a company that manufactured military parts for the U.S. Navy today admitted soliciting and receiving kickbacks in return for providing subcontract work to a Cherry Hill, New Jersey, company, Acting U.S. Attorney William E. Fitzpatrick announced.
Christopher Sanchirico, 55, of King of Prussia, Pennsylvania, pleaded guilty before U.S. District Judge William J. Martini in Newark federal court to an information charging him with conspiracy to violate the federal anti-kickback act. He was released on $100,000 unsecured bond.
According to documents filed in this case and statements made in court:
Sanchirico was the assistant purchasing manager for an entity identified in the information as “Subcontractor 1,” which was located in Philadelphia and manufactured shock-hardened circuit breakers and switchgears for installation on U.S. Navy surface ships, submarines, and aircraft carriers. Subcontractor 1 performed work on multiple U.S. Navy and Defense Logistics Agency maritime contracts as a first-tier subcontractor to a prime contractor working for the United States.
In July 2013, Sanchirico made an agreement with an entity identified in the information as “Subcontractor 2,” a machine shop in Cherry Hill, through Subcontractor 2’s president, identified in the information as “Individual 1.” In return for his assistance in securing a manufacturing contract between Subcontractor 1 and Subcontractor 2, Sanchirico received between five and 10 percent of the gross revenue from circuit breaker and switchgear components that Subcontractor 2 provided to Subcontractor 1. Subcontractor 2’s secretary, identified in the information as “Individual 2,” maintained records of the payments and sometimes made bank withdrawals for the kickbacks when Individual 1 was unable to do so.
From 2013 to 2016, Sanchirico received approximately $150,000 in cash kickbacks from Subcontractor 2.
Sanchirico faces a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gain or loss from the offense. Sentencing is scheduled for Jan. 23, 2018.
Acting U.S. Attorney Fitzpatrick credited agents of the Naval Criminal Investigative Service, Northeast Field Office, under the direction of Special Agent in Charge Leo S. Lamont in Newport, Rhode Island, and agents of the U.S. Department of Defense, Office of the Inspector General, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Leigh-Alistair Barzey, with the investigation leading to the guilty plea. He also thanked the U.S. Attorney’s Office for the Eastern District of Pennsylvania, under the direction of Acting U.S. Attorney Louis D. Lappen, for its assistance.
The government is represented by Assistant U.S. Attorney Joyce M. Malliet of the U.S. Attorney’s Office’s National Security Unit in Newark.
Defense counsel: Michael Drossner Esq., Philadelphia
Owner of Hanford Subcontractor to Pay $235,000 to Settle Small Business Fraud AllegationsRead the Press Release
Spokane - Joseph H. Harrington, Acting United States Attorney for the Eastern District of
Washington, announced that the U.S. Department of Justice (DOJ) and Sage Tee LLC (Sage Tee), a
subcontractor at the Department of Energy's (DOE) Hanford Site, and its owner, Laura Shikashio,
have reached an agreement wherein Sage Tee and Ms. Shikashio have agreed to pay $235,000 to
resolve allegations that they violated the False Claims Act (FCA) in connection with bidding -
receiving two small business subcontracts at DOE's Hanford nuclear site.
Between 2005 and 2016, Washington Closure Hanford, LLC (WCH), a jointly owned by AECOM,
Bechtel National Inc., and CH2M Hill Companies Ltd., was a DOE prime contractor that was
awarded a multi-billion dollar River Corridor Closure Contract (RCC) at DOE's Hanford Site.
WCH was responsible for environmental remediation on Hanford's River Corridor. WCH workers
were responsible for cleaning up waste sites at Hanford, decontaminating and decommissioning
former plutonium production nuclear reactors and surplus facilities, and disposing of contaminated
waste. The RCC required WCH to award a certain percentage of subcontracts to eligible and
qualified small and disadvantaged businesses, including woman-owned small businesses. Pursuant
to the WCC, DOE fully reimbursed WCH for the amounts WCH paid to subcontractors so long as
they were reasonable and allowable under the contract.
The case originally arose out of a whistleblower complaint filed in U.S. District Court by Savage
Logistics LLC, a Hanford-area small business, and Salina Savage, its owner. In December 2013, the
United States filed a Complaint intervening in the lawsuit, alleging that WCH, Sage Tee LLC (an
entity that purported to be a small, disadvantaged business), Laura Shikashio, the owner of Sage Tee,
and another entity known as Federal Engineers and Constructors (FE&C), violated the False Claims
Act (FCA) with respect to two multi-million dollar subcontracts arranged between WCH and Sage
Tee. The Complaint alleges that WCH, Sage Tee, Ms. Shikashio, and FE&C knowingly
misrepresented Sage Tee to be a qualified disadvantaged small business in order to he eligible for
two multi-million dollar subcontracts that were designated for truly qualified small disadvantaged
businesses. The Complaint further alleges that Sage Tee was not a legitimate small, disadvantaged
business; rather it was a pass-through front company for FE&C, which performed substantially all of
the work on WHC's improperly awarded subcontracts. This settlement resolves Sage Tee and Ms.
Shikashio's liability. See attached Settlement Agreement.
Last month, FE&C agreed to pay $2.0 Million to resolve its own liability exposure. WCH continues
to deny liability and the United States' case against WCH continues.
Joseph H. Harrington said, "Small business fraud not only harms the taxpayers and the vital cleanup
mission at Hanford, but also legitimate small, disadvantaged businesses that are cheated from the
opportunity to fairly compete for and perform DOE subcontracts. I want to commend the
Department of Energy Office oflnspector General (DOE-OIG) and the Small Business
Administration Office of Inspector General (SBA-OIG) for the outstanding efforts investigating and
uncovering the scheme perpetrated here. Harrington added, "The United States Attorney's Office
for the Eastern District of Washington, together with our federal law enforcement partners, will
continue to vigorously pursue large and small business fraud at Hanford."
"The false statements in this case were intended to deceive the government into believing that a
woman-owned small, disadvantaged business was performing valuable work as a government
subcontractor," said Small Business Administration Acting Inspector General Hannibal "Mike"
Ware. "OIG will aggressively pursue parties that, through fraud, gain access to SBA's small
business contracting programs. I want to thank the U.S. Attorney's Office for their dedication to
enforcing compliance in SBA's contracting programs."
Department of Energy Acting Inspector General April G. Stephenson said, "The Department of
Energy Office of Inspector General is committed to ensuring the integrity of Departmental contracts
and financial expenditures. We will continue to investigate allegations of fraudulent diversion of tax
dollars throughout DOE programs. This settlement is a result of our staffs dedicated work to ensure
public funds are properly used for the mission-related purposes for which they are intended. We
appreciate the support of Department of Justice's and Department of Energy's attorneys in these
matters."
The Savage whistleblowers will receive approximately $47,000 of the $235,000 settlement DOJ
reached with Sage Tee and Shikashio due to their own private efforts in reporting and exposing the
described scheme to the DOE and DOJ.
DOE-OIG and SBA-OIG conducted the investigation on the Relators' whistleblower complaint.
The DOJ's lawsuit is being prosecuted by Tyler H.L. Tornabene, Vanessa R.Waldref, and Daniel
Fruchter, Assistant United States Attorneys for the Eastern District of Washington.
This case is captioned United States of America ex rel. Salint;J Savage, Savage Logistics LLC, vs.
Washington Closure Hanford LLC, Federal Engineers and Constructors, Inc., Sage Tee LLC, and
Laura Shikashio, EDWA Cause No. CV-10-5051-SMJ.
Old Saybrook Resident Pleads Guilty to Multiple Tax OffensesRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, and Joel P. Garland, Special Agent in Charge of IRS Criminal Investigation in New England, announced that DAVID ADAMS, 56, of Old Saybrook, pleaded guilty today in Hartford federal court to a six-count superseding indictment charging him with various tax offenses. A trial in this matter was scheduled to start today.
According to court documents and statements made in court, in the early 1980s, and then continuing from 1996 onward, ADAMS was substantially delinquent in filing his tax returns and paying amounts owed to the IRS. Starting at least as early as 1998, ADAMS repeatedly engaged with IRS collections officers tasked with trying to get ADAMS into compliance with the tax laws. Although IRS collections officers repeatedly advised ADAMS about his obligations to pay estimated taxes, he continually failed to pay those taxes on time or in sufficient amounts.
As part of this tax fraud scheme, ADAMS engaged the services of a certified public accountant to prepare his personal tax returns beginning in approximately 1993, and then repeatedly failed to give the accountant complete, accurate information.
In 2002, ADAMS sold an online floral business, which accounted for a significant portion of more than $6 million in taxable income he claimed on his 2002 tax return. Although ADAMS represented to the IRS in August 2003 that he was enclosing payment of $1,250,000, no such payment was enclosed and ADAMS never made the payment.
In June 2011, ADAMS sold his partnership interest in another online floral business and received $4,708,419.20 wired into his personal bank account as part of the net proceeds owed to him as a result of the sale. Although he knew that he owed substantial taxes on that amount, ADAMS engaged in a number of affirmative acts to conceal and attempt to conceal this income in order to evade the assessment of a tax including: (1) failing to tell his accountant about the $4,708,419.20 in income ADAMS received in 2011; (2) providing the accountant with false information about ADAMS’s estimated tax payments for the year, telling the accountant that he had paid $220,000 when in fact, ADAMS knew he had only paid $100,000 in estimated taxes for 2011; (3) causing the accountant to prepare his 2011 tax return with false and fraudulent information; and (4) representing to an IRS revenue officer who was responsible for collecting ADAMS’s delinquent tax payments and securing ADAMS’s overdue tax returns, that he had hoped to have funds to pay down his back tax liability (including tax liability associated with the 2002 sale), but that nothing had been “panning out.” ADAMS failed to disclose to the revenue officer that he had received $4,708,419.20 in cash less than three weeks earlier.
In June 2012, ADAMS received an additional $1,320,609.59 into his personal bank account as net proceeds of the 2011 sale. Although he knew that he owed substantial taxes on that amount, ADAMS failed to disclose the income to his accountant, and failed to declare it on his tax return for that year.
In total, ADAMS engaged in a more than 16-year effort to inhibit the IRS’s efforts to collect back taxes from him. Among other things, ADAMS bounced checks to the IRS; told IRS collections officers that payment had been sent when it had not; promised to pay delinquent tax liabilities in full and then delayed payment, made only partial payment, failed to pay at all, or paid off one liability while leaving another liability unpaid; claimed that he lacked funds to pay his delinquent tax but failed to disclose that he had access to enough cash to fully pay back his tax liabilities; filed false and fraudulent returns with the IRS; overstated the amounts of estimated taxes paid to the IRS, and failed to declare more than $6 million in income to the IRS.
ADAMS was arrested on a federal criminal complaint on April 14, 2016.
On December 6, 2016, a grand jury returned a superseding indictment charging ADAMS with two counts of tax evasion, three counts of making and subscribing a false tax return, and one count of attempting to interfere with the administration of the IRS laws. Each tax evasion offense carries a maximum term of imprisonment of five years, each count of filing a false tax return carries a maximum term of imprisonment three years, and the interference charge carries a maximum term of imprisonment of three years.
ADAMS is scheduled to be sentenced by U.S. District Judge Vanessa L. Bryant on January 11, 2018.
As of October 2016, ADAMS owed more than $4.7 million in back taxes, interest and penalties for tax years 2002, 2006, 2007, 2008, 2009, 2011, and 2012. Interest and penalties have continued to accrue since that time.
ADAMS is released on a $500,000 bond pending sentencing.
This matter has been investigated by the Internal Revenue Service – Criminal Investigation Division. The case is being prosecuted by Assistant U.S. Attorneys Susan L. Wines and Jennifer R. Laraia.
North Providence Resident Charged with Producing, Possessing Child PornographyRead the Press Release
PROVIDENCE – Francis Scott, 36, of North Providence, made an initial appearance in federal court in Providence today on a federal criminal complaint charging him with producing and possessing child pornography, announced Acting United States Attorney Stephen G. Dambruch; Rhode Island Attorney General Peter F. Kilmartin; Providence Police Chief Hugh T. Clements, Jr.; and Harold H. Shaw, Special Agent in Charge of the FBI Boston Division.
Scott was ordered detained by U.S. District Court Magistrate Judge Patricia A. Sullivan.
According to information presented to the Court, it is alleged that on February 14, 2017, Scott offered a juvenile female a ride to her Providence high school. Instead of driving her to the school, Scott allegedly drove to a parking lot behind a Providence building where he allegedly sexually assaulted the juvenile female while in his car. It is alleged that Scott video recorded the assault on his cell phone.
According to information presented to the court, it is alleged that after Scott attacked the young female, he drove her to a parking lot near the high school and dropped her off. The victim fled into the school and reported the attack.
According to information presented to the Court, Providence Police officers and detectives, including a detective assigned to the Providence Police Major Crimes Unit and Special Victims Unit, and who is a member of the FBI Child Exploitation Task Force, canvassed the area where the student was allegedly picked up and where the alleged attack took place. Over the next several days, piecing together information and evidence gathered from several locations, including video surveillance, investigators identified the vehicle allegedly used in the assault. The vehicle was traced back to Scott’s girlfriend. It was determined that Francis Scott was allegedly driving the vehicle the day of the assault.
Francis Scott was arrested by Providence Police on February 23, 2017, and charged in Rhode Island state court with kidnapping and second-degree sexual assault. The investigation into Scott’s alleged criminal activities continued after the arrest. Scott was subsequently indicted by a Rhode Island state grand jury on May 17, 2017, on one count each of kidnapping of a minor with intent to sexually assault, 2nd degree sexual assault, assault with dangerous weapon, 1st degree sexual assault , 2nd degree robbery and 3 counts of 2nd degree sexual assault. He was ordered detained at the Adult Correctional Institutions.
The Providence Police Department and the FBI continue to investigate the alleged criminal conduct of Francis Scott. Anyone with information concerning these alleged matters, or who believe they may have been a victim of Scott’s alleged criminal conduct, are urged to contact the Providence office of the FBI at (401) 272-8310.
The case against Francis Scott in federal court is being prosecuted by Assistant U.S. Attorney Denise M. Barton. Cases charges in Rhode Island Superior Court are being prosecuted by Rhode Island Special Assistant Attorney General Meghan McDonough.
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Newark, New Jersey, Registered Sex Offender Sentenced to 21 Years in Prison for Attempting to Entice A Minor to Engage in Sexual ActivityRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced today that TERRICK WASHINGTON, 45, a registered sex offender, was sentenced to 262 months in prison by United States District Judge Kenneth M. Karas for his attempted enticement of a minor to engage in sexual activity. Judge Karas also imposed a 5-year term of supervised release to follow the prison term. The sentencing today followed WASHINGTON’s guilty plea on March 8, 2017.
Acting U.S. Attorney Joon H. Kim stated: “Protecting children from those who prey on them is a priority for this Office and our partners at the FBI. As today’s sentencing demonstrates, we will use every tool available to law enforcement to prosecute and punish those who sexually exploit children.”
According to documents filed in this case and statements made in related court proceedings:
On or about December 21, 1993, Washington was convicted in New Jersey of Aggravated Sexual Assault and sentenced to a 15-year prison term. As a result of that conviction, he was required to register in New Jersey as a sexual offender.
In November 2015, an individual (the “Reporter”) advised the FBI that the Reporter, posing as a 13-year-old girl, had engaged in online communications with a person using the screen name “X.Terrick..X.” During the communications, “X.Terrick..X” indicated that “X.Terrick..X” wanted to engage in sexual activities with the Reporter. The FBI instructed the Reporter to continue to engage in discussions, to provide the FBI with daily logs of the communications, and to attempt to arrange a meeting with “X.Terrick..X.”
Between November 6, 2016, and November 27, 2015, the Reporter and “X.Terrick..X,” later identified as TERRICK WASHINGTON, engaged in a series of text communications. Among other things, the Reporter told WASHINGTON she was 13 years old and WASHINGTON told the Reporter that he was 44 years old. During the communications, WASHINGTON described in detail a variety of sexual acts he wanted to perform on the 13-year-old and made arrangements to meet her in Orange County, New York.
On November 28, 2015, WASHINGTON was arrested when he arrived at the Harriman Metro North Station, in Harriman, New York. Following his arrest, he admitted that he had met a young girl on the internet while using a chat application from his cell phone and that he made arrangements to meet her so that he could have sex with her. Initially, WASHINGTON said that the girl told him she was 15, but he later admitted that, in fact, the girl said she was 13. WASHINGTON also said that he had been convicted of a sex offense when he was 18 involving a 5-year-old girl and that, as a result of that conviction, he is required to register as a sex offender.
Mr. Kim praised the efforts of the Federal Bureau of Investigation, the Orange County District Attorney’s Office, the Orange County District Attorney’s Investigators, and the Orange County Sheriff’s Department in connection with this investigation.
The prosecution is being handled by the Office’s White Plains Division. Assistant United States Attorney Marcia S. Cohen is in charge of the prosecution.
More Than $5.2 Million in Federal Grants Awarded to Agencies in the Western DistrictRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Jill Westmoreland Rose announced today that $5,270,994 in federal grants have been awarded to local law enforcement agencies, non-profit organizations, and tribal government programs in the Western District of North Carolina. The federal grants are administered by multiple awarding agencies, which are components of the Justice Department’s Office of Justice Programs (OJP).
“Federal grants are an important funding source for a broad spectrum of agencies in the Western District. Local law enforcement, non-profit service providers, community organizations and tribal governments count on federal grants to supplement their resources, launch new initiatives, support existing programs, and provide important services to their communities. The awarded grants will be used to enhance the Justice Department’s and my Office’s efforts to reduce violent crime, assist victims of crime, enhance access to services and increase public safety throughout this district,” said U.S. Attorney Rose.
The recipients of the grants are:
City of Charlotte: Two federal grants totaling $1,431,708 were awarded to the Charlotte-Mecklenburg Police Department (CMPD). Specifically, $1,125,606 will be used to sustain and expand CMPD’s current testing of Sexual Assault Kits (SAKs), to reduce the existing number of SAKs in its inventory, and to update CMPD’s current technology related to SAKs. Another $306,102 has been awarded to enhance CMPD’s current DNA analysis process, to reduce the current number of DNA cases and to maintain CMPD’s laboratory capabilities.
Mecklenburg County: The County will receive a total of $718,794 in federal grants, of which $368,798 will be used to support the County’s implementation of the Mecklenburg County Systemic Response Plan to the opioid crisis, including, to gather information about and enhance services to targeted populations. The Mecklenburg County Community Support Services Department will receive a $349,996 federal grant, to provide housing and supportive services to 20 victims of domestic violence, sexual assault, dating violence or stalking and their families.
Eastern Band of Cherokee Indians (EBCI): As the recipients of three federal grants totaling $1,720,442, EBCI will apply the awarded funds to combat violence against women in Indian Country, improve public safety, serve victims of crime, increase access to victim services including housing and legal assistance, coordinate outreach and awareness activities, and support youth programs in Indian Country.
30th Judicial District Domestic Violence-Sexual Assault Alliance: The grantee has been awarded $600,000 toward increasing victim advocacy and providing comprehensive legal services to victims of domestic violence, sexual assault, dating violence and stalking in Cherokee, Clay, Graham, Haywood, Jackson, Macon and Swain Counties in Western North Carolina.
Haywood County: As recipient of a $450,000 grant, the County will collaborate with the 30th Judicial District Domestic Violence-Sexual Assault Alliance to provide centralized and comprehensive services to victims of domestic violence, sexual assault, dating violence and stalking. A portion of the funds will be used to provide sexual assault training for law enforcement officers, technical assistance related to investigations, and services to specific victims.
Helpmate, Incorporated: Awarded $350,000, Helpmate, in cooperation with the Housing Authority of the City of Asheville, will use the grant to provide, among other things, permanent housing and supportive services to 20 survivors of domestic violence, sexual assault, dating violence or stalking and their families.
Office of Justice Programs (OJP) and current OJP funding opportunities can be found at: https://ojp.gov/funding/index.htm
The Office on Violence Against Women (OVW) administers grant programs authorized by the Violence Against Women Act (VAWA) of 1994 and subsequent legislation. For a list of OVW grant programs and additional grant funding information please visit: http://www.justice.gov/ovw/grant-programs.
The Bureau of Justice Assistance (BJA) provides leadership and assistance to local criminal justice programs that improve and reinforce the nation’s criminal justice system. BJA’s goals are to reduce and prevent crime, violence, and drug abuse and to improve the way in which the criminal justice system functions. BJA works closely with programs that bolster law enforcement operations, expand drug courts, and provide benefits to safety officers. BJA Funding announcements are posted at: https://www.bja.gov/funding.aspx.
The National Institute of Justice (NIJ) is the research, development and evaluation agency of the U.S. Department of Justice, dedicated to improving knowledge and understanding of crime and justice issues through science. For additional information and to locate a funding opportunity please visit:
http://www.nij.gov/funding/Pages/welcome.aspx.
Middleburg Man Pleads Guilty to Using an Infant and A Toddler to Produce Child PornographyRead the Press Release
Jacksonville, Florida – Acting United States Attorney W. Stephen Muldrow announced today that Andrew Ryan Leslie (22, Middleburg) has pleaded guilty to two federal charges that he sexually abused an infant and a toddler, and used them to produce images and videos of child pornography. He faces a mandatory minimum penalty of 15 years, up to 60 years, in federal prison and a potential life term of supervision. A sentencing date has not yet been set. Leslie has been in federal custody since his arrest on October 18, 2016.
According to court documents, in 2015, agents with U.S. Immigration and Customs Enforcement’s Homeland Security Investigations began an investigation into websites known to host images and videos depicting child pornography. In 2016, Leslie was positively identified as a member of one of these websites. On October 18, 2016, HSI agents and other law enforcement officers executed a federal search warrant at Leslie’s residence in Middleburg, Florida. Upon entering the residence, agents observed Leslie emerging from the master bedroom. Leslie stated that a minor child, referred to by Leslie as a “toddler,” had been in bed with him when the agents arrived.
During the search, agents located a digital camera next to Leslie’s bed in the master bedroom. Within the camera was a micro SD card containing a series of pornographic images depicting Leslie with two different minor children. In several of the images, the same toddler (approximately two years old) was depicted. Other images depicted a different infant less than a year old. These images depicted Leslie sexually abusing both children.
Agents also seized several laptop computers, computer hard disk drives, tablets, cell phones, and cameras from Leslie’s residence. A forensic analysis of these items revealed that Leslie had produced, received, distributed, and possessed numerous images and videos depicting child pornography. Recovered logs of online conversations between Leslie and other individuals showed that Leslie had discussed engaging in sexual activity with several minor children.
This case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, and the Clay County Sheriff’s Office. It is being prosecuted by Assistant United States Attorney D. Rodney Brown.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Member of Camden, New Jersey, Drug Trafficking Organization Sentenced to Eight Years in Prison for Drug DistributionRead the Press Release
CAMDEN, N.J. – A Camden man was sentenced today to 96 months in prison for selling crack cocaine, Acting U.S. Attorney William E. Fitzpatrick announced.
Nafeez Griffin, a/k/a “Feez,” 31, previously pleaded guilty before U.S. District Judge Jerome B. Simandle to an information charging him with one count of distribution and possession with intent to distribute cocaine base. Judge Simandle imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Griffin admitted that on Nov. 30, 2015, he sold crack cocaine to an undercover officer on the 1100 block of Lansdowne Avenue, which was then under the control of a drug distribution organization of which he was a member. Griffin also admitted that other members of the organization supplied drugs to him, and that he made sales of crack cocaine on other occasions. Griffin and others were originally charged by complaint on Sept. 9, 2016, following a long-term investigation by the FBI’s South Jersey Violent Offender and Gang Task Force. Law enforcement officers seized drugs and recovered two handguns that were kept by members of the conspiracy in connection with the organization’s drug trafficking activities. Investigators also intercepted communications pursuant to court-authorized wiretaps on cellular telephones used by several members of the conspiracy.
In addition to the prison term, Judge Simandle sentenced Griffin to three years of supervised release.
Acting U.S. Attorney Fitzpatrick credited special agents of the FBI’s South Jersey Violent Offender and Gang Task Force, South Jersey Resident Agency, under the direction of Special Agent in Charge Michael Harpster; the Camden County Police Department, under the direction of Chief J. Scott Thomson; the Camden County Prosecutor’s Office, under the direction of Prosecutor Mary Eva Colalillo; and the N.J. State Police, under the direction of Col. Rick Fuentes, with the investigation leading to today’s sentencing.
He also thanked the Camden County Sheriff’s Department, the Cherry Hill Police Department, and the U.S. Department of Homeland Security Investigations (HSI) for their assistance.
The government is represented by Assistant U.S. Attorney Gabriel J. Vidoni of the U.S. Attorney’s Office Criminal Division in Camden.
Luzerne County Man Charged with Unlawfully Possessing A Firearm as A Convicted FelonRead the Press Release
SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Robert Romasiewicz, age 25, of Exeter, Pennsylvania, was charged in a criminal information on October 6, 2017, with unlawfully possessing a firearm as a convicted felon.
According to United States Attorney Bruce D. Brandler, the information alleges that Romasiewicz was in possession of a Smith and Wesson 9mm handgun in July-August 2017, in Luzerne County, having previously been convicted of a crime punishable by more than one year in prison.
The charge stems from an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorney Francis P. Sempa is prosecuting the case.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is 10 years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Leader of Violent Group Resentenced to Life Imprisonment Plus 30 YearsRead the Press Release
BATON ROUGE, LA – Acting U.S. Attorney Corey Amundson announced that U.S. District Judge Shelly D. Dick has re-sentenced Jeffery D. Perry, age 34, formerly of Baton Rouge, Louisiana, to a term of life imprisonment, followed by a term of 30 years imprisonment, for federal drug trafficking and firearm-related violations.
Perry’s re-sentencing follows his unsuccessful appeal to the U.S. Court of Appeals for the Fifth Circuit, which affirmed his convictions and returned the matter to the district court in order to increase his original prison term from life imprisonment plus 15 years to life imprisonment plus 30 years.
On August 19, 2015, Perry was originally sentenced after being convicted following a multi-week jury trial in September 2014 of conspiring to distribute cocaine and “crack” cocaine, distributing cocaine and “crack” cocaine, car-jacking, possessing firearms in furtherance of crimes of violence and drug trafficking crimes, and possessing firearms while a convicted felon.
At his original sentencing hearing, the Court found that Perry made his living trafficking drugs and that he did whatever it took to protect his drug trafficking enterprise. As an example of his danger to the community, the Court noted that reliable evidence suggested that Perry had hired an individual and two young men to set an elderly man’s house on fire. These two young men died later that day as a result of burns they sustained from the arson they had committed. During sentencing, the Court noted Perry’s cold-blooded and callous statements about one of the arsonists, as he lay dying in his backyard, seeking medical assistance for the injuries he sustained from the fire Perry had hired him to set.
Evidence at trial showed that, from August 2006 until September 2011, Perry led a drug-trafficking endeavor within Baton Rouge operating largely on Evergreen Street, Louisiana Street, and Delphine Street, which distributed kilogram and multi-ounce amounts of cocaine and “crack” cocaine. Customers used cash, stolen equipment, firearms, and food stamps to purchase in those locations varying amounts of cocaine and “crack” cocaine from Perry. He used “crack” addicts to test the quality of the “crack” he cooked before selling it to others.
As the Court found, Perry often used violence. As another example, evidence at trial showed that Perry solicited the assistance of Mark Allen to rob another individual who had been supplying him with kilogram amounts of cocaine. A few days after this robbery, Perry enlisted Allen’s assistance to rob one of his customers of approximately $80,000. During this robbery, Allen shot and wounded the customer and car-jacked him. After Allen met Perry and handed the cash he had taken during the armed robbery over to Perry, the latter rewarded Allen, whom he then knew to be a convicted felon, with an ounce of “crack” cocaine and a Taurus .40 caliber semi-automatic pistol to protect himself against any reprisals the victim or his friends might take as a result of the robbery Allen had committed.
Other Group Members
- On August 31, 2011, following trial, a jury convicted Donald Frank of conspiracy to distribute cocaine for conduct arising from his drug trafficking endeavors, on behalf of Perry. On March 6, 2012, he was sentenced to serve a time of life imprisonment by United States District Judge James J. Brady.
- On June 16, 2015, Judge Dick sentenced Jermaine Chapman who, along with Perry, had also been convicted of drug trafficking and firearm-related violations at trial, to a forty-five year term of imprisonment.
- On June 18, 2015, Judge Dick sentenced Charles Boyer who, along with Perry and Chapman, had also been convicted at trial of conspiracy to commit drug trafficking, to a ten year term of imprisonment.
Acting U.S. Attorney Amundson stated, “Perry and his co-conspirators brutalized and victimized neighborhoods for years. This outcome very clearly illustrates the ability of the federal system, in partnership with our state and local partners, to make a real difference against group-based violent crime. I greatly appreciate the excellent work of the prosecutors and the federal, state, and local agents who handled this important matter. The recently created Violent Criminal Enterprises Strike Force, with the support of the community, seeks to institutionalize this successful approach to make our neighborhoods safer and more secure.”
DEA Assistant Special Agent-in-Charge Brad Byerley stated, “Federal, state and local law enforcement have successfully collaborated in order to put this violent drug dealer in jail for the rest of his life as a result of his desire to supply the citizens of Baton Rouge with cocaine. This life sentence sends a message that violent drug traffickers, such as Jeffery Perry, will be held accountable for their crimes. DEA and our law enforcement partners will continue to work together to keep our community safe.”
Interim Chief Jonathan Dunnam of the Baton Rouge Police Department stated, “This case is proof that federal, state and local agencies all working together to end group violence in Baton Rouge can and will be effective. We look forward to working with the new Violent Criminal Enterprises Strike Force to help reduce violent crime in our community.”
Col. Kevin Reeves of the Louisiana State Police stated, “Robust partnerships and operational collaboration will continue to yield success as public safety remains our number one priority in Louisiana. I am thankful for the hard work of our Troopers and all of the partners involved in this investigation.”
This matter was handled by the U.S. Attorney’s Office for the Middle District of Louisiana, the Drug Enforcement Administration, and the Baton Rouge City Police, with valuable assistance from the Louisiana State Police, including its crime lab, and the Jefferson County, Texas, Sheriff’s Office. It was prosecuted by Assistant United States Attorney Robert W. Piedrahita, who serves as Litigation Counsel, and Assistant United States Attorney Chris Dippel, who serves as a Deputy Chief in the Criminal Division.
Lake Providence woman sentenced to 18 months in prison for stealing more than $52,000 in HUD fundsRead the Press Release
MONROE, La. – Acting U.S. Attorney Alexander C. Van Hook announced that a Lake Providence woman was sentenced last week to 18 months in prison for stealing more than $52,000 from a housing development by falsifying receipts for work that was never performed.
Stephanie R. Threats, 46, of Lake Providence, La., was sentenced Wednesday by U.S. District Judge S. Maurice Hicks Jr. on one count of conspiracy to commit federal program theft. She was also sentenced to three years of supervised release. According to the June 1, 2017 guilty plea, Threats worked for an Oak Grove, La., elderly housing apartment company, which received funds from the Office of Housing and Urban Development through Section 202 of the Federal Housing Program. From July 2009 until July 2012, Threats stole $52,241.69 from the program by creating false invoices for work performed for the benefit of the apartments and the HUD program recipients, when in reality no work had been performed.
The Office of Housing and Urban Development-Office of Inspector General conducted the investigation. Assistant U.S. Attorney Brandon B. Brown prosecuted the case.
Justice Department Settles with Montgomery County, Maryland, After School Program to Ensure Compliance with the ADARead the Press Release
The Justice Department announced today that it reached an agreement with Bar-T Year Round Programs for Kids (Bar-T), located in Montgomery County, Maryland, to remedy alleged violations of the Americans with Disabilities Act (ADA). Title III of the ADA prohibits public accommodations, including child care centers, from discriminating against individuals with disabilities and those associated with them. Bar-T is the largest provider of before and after school programs in Montgomery County, operating at approximately 30 Montgomery County public school locations.
The department investigated whether Bar-T discriminated against a student with a disability, specifically Autism Spectrum Disorder (ASD), and her parents when it expelled the student on the basis of behaviors associated with ASD, without properly considering whether Bar-T staff could implement reasonable modifications to permit the student to remain enrolled. The settlement agreement requires Bar-T to adopt a nondiscrimination policy; designate staff at each operating location to address ADA issues; implement a process for parents or guardians of children with disabilities to request reasonable modifications and for Bar-T to conduct an individualized assessment of each request; provide ADA training to staff; and report on compliance with the agreement. Bar-T will also pay $13,500 in compensatory damages to the student and her parents.
“Through this agreement, Bar-T is taking important steps to make sure that all children in its programs, including children with disabilities, will be given the opportunity to have a positive and successful experience in a supportive after school environment,” said Acting Assistant Attorney General John Gore of the Civil Rights Division.
“Children with disabilities deserve equal opportunities to attend after school programs. The policies Bar-T has agreed to implement will ensure that its programs provide an inclusive environment for all students,” said Acting United States Attorney for the District of Maryland Stephen M. Schenning.
To read the settlement agreement or for more information on the ADA, visit www.ada.gov. For more information about the ADA, including how to file a complaint, call the Department’s toll-free ADA Information Line at 800-514-0301 (TDD 800-514-0383) or access the ADA website at www.ada.gov.
Junction City Man Sentenced in Kidnapping of Woman Who Was KilledRead the Press Release
TOPEKA, KAN. – A Junction City man who took part in a woman’s kidnapping that led to her murder was sentenced Tuesday to 10 years in federal prison, U.S. Attorney Tom Beall said.
Christopher Pugh, 33, Junction, City, Kan., pleaded guilty to one count of kidnapping. In his plea, he admitted participating in the kidnapping of Amanda Clemons, a 24-year-old woman whose body was found in February 2014 in Geary County, Kan.
In his plea, Pugh admitted that on Feb. 7, 2014, he was one of the defendants who met the victim, who was a prostitute, at a hotel in Junction City and kidnapped her. The defendants beat the victim in retribution for comments she had made on social media. During the beating, the defendants demanded the victim pay $300. They took the victim to another hotel room in an unsuccessful attempt to get the money, after which they transported her to a residence on Fort Riley where two of the defendants lived.
While at the residence, the defendants allowed the victim to call her young son and her mother. The victim’s mother realized the victim was in danger and called Junction City Police. When police called the victim’s number to check on her, the defendants listened to the call on speakerphone. At that time, Pugh left the house alone and did not take part in the murder.
Fearing that police were coming to arrest them, defendants Drexel Woody, Larry L. Anderson and Marryssa Middleton took the victim to a bridge in a remote part of Geary County. Once there, Anderson and Middleton resumed the beating and attacked the victim with a knife. The victim broke free and jumped off the bridge, falling 15 feet and breaking her ankle. Anderson and Middleton found the victim in the snow beneath the bridge and resumed the assault during which they cut her throat and killed her.
Co-defendants include:
Larry L. Anderson of Manhattan, Kan., who was sentenced to 28 years.
Marryssa M. Middleton of Fort Riley, Kan., who was sentenced to 28 years.
Drexel A. Woody, 27, of Fort Riley, who was sentenced to 16 years.
Shantrell D. Woody of Fort Riley, Kan., who is set for sentencing Nov. 20.
Beall commended the Junction City Police Department, the Grandview Plaza Police Department, the Geary County Sheriff’s Office, the Riley County Police Department, the Fort Riley Criminal Investigation Division, the FBI, Assistant U.S. Attorney Tony Mattivi, Assistant U.S. Attorney Jared Maag and Geary County Attorney Steven Opat for their work on the case.
Hartford Man Sentenced to 5 Years in Federal Prison for Heroin and Firearm OffensesRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that DAVID VALENTIN, 38, of Hartford, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 60 months of imprisonment, followed by four years of supervised release, for heroin and firearm offenses.
According to court documents and statements made in court, on January 29, 2016, VALENTIN was arrested after Hartford Police officers conducted a court-authorized search of his Congress Street residence and seized 2,684 wax folds of heroin, 15.1 grams of raw heroin, and a loaded .380 caliber pistol that had been reported stolen.
On April 18, 2017, VALENTIN pleaded guilty to one count of possession with intent to distribute heroin, and one count of possession of a firearm in furtherance of a drug trafficking crime.
VALENTIN’s criminal history includes 10 felony convictions.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Hartford Police Department. The case was prosecuted by Assistant U.S. Attorney Patricia Stolfi Collins.
Halsey B. Frank Sworn in as United States AttorneyRead the Press Release
Portland, Maine: The United States Attorney’s Office announced that Halsey B. Frank has taken the oath of office to become the U.S. Attorney for the District of Maine. U.S. Attorney Frank was nominated by President Donald Trump on July 27, 2017 and confirmed by the U.S. Senate on October 4, 2017. He took the oath of office today from U.S. District Court Chief Judge Nancy Torresen.
U.S. Attorney Frank is the top-ranking federal law enforcement official in the District of Maine. He oversees a staff of 47 employees and contractors located in Portland and Bangor, including 24 attorneys, 20 non-attorney support personnel and three contractors. The office is responsible for prosecuting federal crimes in the district, including crimes related to terrorism, public corruption, child exploitation, firearms, and narcotics. The office also defends the United States in civil cases and collects debts owed to the United States.
U.S. Attorney Frank grew up in New York City and in Englewood, New Jersey. Prior to becoming U.S. Attorney for the District of Maine, he was an Assistant U.S. Attorney (AUSA) in the District of Maine where, from 1999 to 2017, he prosecuted federal crimes and defended the United States in civil actions in federal district court. From 1990 to 1999, he served as an AUSA in the District of Columbia, where he prosecuted crimes in the Superior Court for the District of Columbia and in the U.S. District Court for the District of Columbia, and defended the United States in civil actions in the district court. From 1987 to 1990, he served as a Trial Attorney in the Torts Branch of the Civil Division of the Department of Justice in Washington, D.C., where he defended the United States in tort actions around the country. U.S. Attorney Frank is a 1980 graduate of Wesleyan University and a 1986 graduate of Boston University School of Law.
Group Responsible for ATM Thefts SentencedRead the Press Release
Anchorage, Alaska - Acting U.S. Attorney Bryan Schroder announced today that, on Friday, Oct. 6, 2017, the group responsible for ATM thefts at several Anchorage banks were sentenced in U.S. District Court in Anchorage.
Chief U.S. District Judge Timothy M. Burgess sentenced Adrian Turnbow, Christi Cozzetti, Jerd Thacker, and Jordan Cook for their roles in ATM thefts from banks in early 2017. All had previously pleaded guilty to the crime of possession of stolen bank property.
Turnbow used front end loaders stolen from local construction sites to remove ATMs from Anchorage banks. Turnbow was involved in thefts or attempted thefts that occurred at an Alaska USA branch on Dec. 25, 2016, at Denali Federal Credit Union on Feb. 6, and at two First National Bank branches on March 1, and March 6, 2017.
Cozzetti, Thacker, and Cook participated in the March 1, 2017, theft. On that date, Turnbow used a front end loader to remove an Automated Teller Machine (ATM) from a First National Bank branch located near the intersection of Old Seward Highway and Dimond Boulevard in Anchorage. Turnbow then contacted Jerd Thacker, who assisted him in transporting the ATM to the Wasilla area. While Turnbow was inside a heavy equipment rental business in Wasilla, Thacker stole Turnbow’s truck that contained the stolen ATM, then he, Cozzetti, and Thacker travelled to Big Lake where they attempted to open the ATM.
Adrian Turnbow, 26, of Anchorage, was sentenced to 30 months in prison, followed by three years of supervised release. In addition, Turnbow was ordered to pay a total of $452,933 in restitution to the following businesses: Alaska Federal Credit Union, Titan LLC, Denali Federal Credit Union, BC Excavating, and First National Bank. Turnbow also agreed to abandon any interest he had in a blue Chevrolet truck that was purchased with money from one of the stolen ATMs and was used to facilitate the theft of another ATM. Judge Burgess noted at Turnbow’s sentencing that his crimes were serious and caused ripples of problems across the community, as customers could not use the ATMs at their banks and banks lost customers.
Cristi Cozzetti, 29, of Anchorage, was sentenced to 18 months in prison, followed by three years of supervised release and 200 hours of community work service. Judge Burgess noted at Cozzetti’s sentencing that she had a “terrible” criminal history and that this sentence would protect the public from her future crimes.
Jerd Thacker, 28, of Anchorage, was sentenced to 12 months and one-day in prison, followed by three years of supervised release and 200 hours of community work service. Thacker and others possessed a stolen ATM on March 1, 2017, and attempted to open it after it had been stolen from an Anchorage bank by Turnbow. Judge Burgess noted that there was “no honor among thieves” with regard to Thacker stealing Turnbow’s truck that he knew contained a stolen ATM.
Jordan Cook, 29, of Anchorage, was sentenced to seven months in prison, followed by three years of supervised release and 200 hours of community work service.
Judge Burgess ordered community work service as a condition for Cozzetti, Thacker, and Cook so they may contribute something positive to the community after they have served their sentences.
Acting U.S. Attorney Schroder commended the diligence and hard work of the Federal Bureau of Investigation, the Anchorage Police Department, and the Alaska State Troopers for the investigation leading to the successful prosecution of Turnbow, Cozzetti, Thacker, and Cook.
Goose Creek Tax Return Preparer Sentenced to Prison for Filing Fraudulent Tax ReturnsRead the Press Release
Columbia, South Carolina---- United States Attorney Beth Drake stated today that Stacy B. Middleton, age 47, of Goose Creek, South Carolina, was sentenced in federal court in Charleston, South Carolina, on two felony counts of Willfully Preparing and Filing a False Income Tax Return, in violation of Title 26, United States Code, Section 7206(2). Senior United States District Court Judge Patrick Michael Duffy sentenced Middleton to 41 months imprisonment and 1 year of supervised release.
According to court documents and in statements made during court hearings, Middleton owned and operated a tax preparation business in Charleston named MBM Tax & Accounting Services, LLC (“MBM”). For calendar years 2009, 2010, and 2011, Middleton prepared and electronically filed over 1,300 false and fraudulent income tax returns for his clients without their knowledge in order to increase their refunds. The income tax returns contained overstated, duplicated or fictitious deductions, fictitious Schedules C to maximize Earned Income Tax Credits, fabricated expenses for Schedules A, C and E, fraudulent refundable credits, and fictitious Forms 1099. Middleton admitted that his scheme caused a tax loss of $3,500,000.
Ms. Drake stated that the case was investigated by agents of the Internal Revenue Service-Criminal Investigation. Assistant United States Attorney Dean H. Secor of the Charleston Office prosecuted the case.
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Gang Member Sentenced to Prison After Lying to Grand JuryRead the Press Release
Keno Deandre Lane, aka Savage, 25, of Nashville, Tenn., was sentenced on October 6, 2017, to five years in prison, followed by three years of supervised release, for making a false declaration before a grand jury, announced United States Attorney Donald Q. Cochran of the Middle District of Tennessee.
Lane was indicted in April 2016 and pleaded guilty earlier this year to lying to a grand jury, obstructing justice and being an unlawful drug user in possession of a firearm.
“Serious consequences, including significant time in federal prison, await those who choose to lie during a grand jury proceeding,” said U.S. Attorney Cochran. “The U.S. Attorney’s Office will vigorously prosecute those who impede the grand jury’s work by giving false testimony or otherwise interfere with this critical part of the criminal justice system.”
According to court documents, Lane was a Five Deuce Hoover Crip gang member and on September 11, 2015, Metropolitan Nashville Police officers encountered Lane, who was in possession of a firearm. Subsequent investigation determined that this firearm was originally taken during the armed robbery of a Cricket Wireless store near the J.C. Napier neighborhood on January 22, 2015. This same firearm was later used in three armed robberies, as well as the murder of Isaiah Starks, aka Blue, which occurred on February 9, 2015 in the J.C. Napier public housing development. Lane was later subpoenaed to testify before a federal grand jury investigating those crimes, and intentionally lied to the grand jury about when and how he obtained that firearm.
Three other defendants, Aweis Haji-Mohammed, Marquis Brandon, and Reginald Johnson, are charged in connection with this case and their cases are pending. They are presumed innocent of the charges against them unless and until proven guilty in a court of law.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Metropolitan Nashville Police Department – Gang Unit. The case is being prosecuted by Assistant United States Attorney Sunny A.M. Koshy.
Former nursing home employee pleads guilty for embezzling over $80,000Read the Press Release
CHARLESTON, W.Va. – A former nursing home employee who embezzled over $80,000 pleaded guilty today, announced United States Attorney Carol Casto. Veneford Blankenship, 35, of Princeton, entered her guilty plea to mail fraud.
Blankenship worked at a nursing home in Princeton as the Business Office Supervisor where she oversaw the financial operations. Her duties included sending patient invoices, recording deposits in the nursing home’s accounting program, and depositing checks into the nursing home’s operations account. The nursing home also had another bank account, which allowed residents to collect funds that were occasionally spent on dinner, outings, and small events for residents. While the nursing home’s parent company received bank statements for its operations account, the parent company did not receive any statements for the other bank account.
Blankenship admitted that in June 2015, she began secretly diverting residents’ payment checks. Instead of depositing these checks into the operations account, she deposited the checks into the other bank account. She then wrote checks to herself from the other account, forging the signatures of the two individuals with signature authority. She hid her crime by writing false memos on the checks and indicating that the withdrawals were for legitimate nursing home purposes, when in reality she took the money for herself. She also falsely updated the nursing home’s accounting program to indicate that the residents paid invoices and that the nursing home received funds that she had stolen.
Blankenship faces up to 20 years in federal prison when she is sentenced on January 23, 2018. As part of her plea agreement, Blankenship agreed to pay restitution in the amount of $82,926.15.
The FBI and the Postal Inspection Service conducted the investigation. Assistant United States Attorney Meredith George Thomas is in charge of the prosecution. The plea hearing was held before Senior United States District Judge David A. Faber.
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Former Postal Worker Sentenced for Stealing Money OrdersRead the Press Release
ALBANY, NEW YORK – Naisha Wiley, 35, of Schenectady, New York, was sentenced today to a three-year term of probation for stealing $10,000 in money orders from the United States Postal Service (USPS).
The announcement was made by Acting United States Attorney Grant C. Jaquith, Eileen Neff, Special Agent in Charge of the Northeast Area for the United States Postal Service, Office of the Inspector General, and Inspector in Charge Shelly A. Binkowski, United States Postal Inspection Service, Boston Division.
In pleading guilty, Wiley admitted that while working part-time as a retail clerk in Post Offices in Montgomery County in 2016 and 2017, she stole U.S. Postal Service money orders totaling $10,000. She also admitted to stealing gift cards from the mail.
Senior United States Judge Thomas J. McAvoy also ordered Wiley to pay $10,170.00 in restitution to her victims, and complete 50 hours of community service.
This case was investigated by the United States Postal Service, Office of the Inspector General, and the United States Postal Inspection Service, and was prosecuted by Assistant U.S. Attorney Michael Barnett.
Former North Carolina Police Officer Sentenced to 15 Years in Prison for Participation in Drug Distribution ConspiracyRead the Press Release
WASHINGTON - A former police officer with the Windsor, North Carolina Police Department was sentenced today to 180 months in prison for accepting bribe payments from a purported large-scale drug trafficking organization in exchange for protecting shipments of purported narcotics.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney Robert J. Higdon, Jr. of the Eastern District of North Carolina made the announcement.
Antonio Tillmon, 33, of Windsor, North Carolina, was sentenced by Senior U.S. District Court Judge Malcolm J. Howard. In addition to the term of prison imposed, Judge Howard ordered Tillmon to serve five years of supervised release. In May 2017, Tillmon was found guilty of drug, firearm, and bribery charges following a week-long jury trial.
According to trial evidence, Tillmon accepted $6,500 from undercover FBI agents posing as drug traffickers in return for transporting a total of 30 kilograms of heroin from North Carolina to Maryland on three separate occasions between August 2014 and April 2015. On each occasion, Tillman carried with him his Windsor Police Department badge and a firearm, and was prepared to use his badge and fake documentation to evade drug interdiction by legitimate law enforcement. The evidence at trial also showed that Tillmon was poised to participate in another drug run on a fourth occasion the day that he was arrested—and he had brought with him five firearms, including an assault rifle.
Fourteen other defendants, 12 of whom were law enforcement or correctional officers, were charged as a result of this investigation. Those defendants all pleaded guilty to various offenses and were sentenced in June 2017.
The case was investigated by the FBI’s Charlotte Division, Raleigh Resident Agency. The case is being prosecuted by Trial Attorneys Lauren Bell and Molly Gaston of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Toby W. Lathan of the Eastern District of North Carolina.
Former North Carolina Police Officer Sentenced to 15 Years in Prison for Participation in Drug Distribution ConspiracyRead the Press Release
A former police officer with the Windsor, North Carolina Police Department was sentenced today to 180 months in prison for accepting bribe payments from a purported large-scale drug trafficking organization in exchange for protecting shipments of purported narcotics.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney Robert J. Higdon, Jr. of the Eastern District of North Carolina made the announcement.
Antonio Tillmon, 33, of Windsor, North Carolina, was sentenced by Senior U.S. District Court Judge Malcolm J. Howard. In addition to the term of prison imposed, Judge Howard ordered Tillmon to serve five years of supervised release. In May 2017, Tillmon was found guilty of drug, firearm, and bribery charges following a week-long jury trial.
According to trial evidence, Tillmon accepted $6,500 from undercover FBI agents posing as drug traffickers in return for transporting a total of 30 kilograms of heroin from North Carolina to Maryland on three separate occasions between August 2014 and April 2015. On each occasion, Tillman carried with him his Windsor Police Department badge and a firearm, and was prepared to use his badge and fake documentation to evade drug interdiction by legitimate law enforcement. The evidence at trial also showed that Tillmon was poised to participate in another drug run on a fourth occasion the day that he was arrested—and he had brought with him five firearms, including an assault rifle.
Fourteen other defendants, 12 of whom were law enforcement or correctional officers, were charged as a result of this investigation. Those defendants all pleaded guilty to various offenses and were sentenced in June 2017.
The case was investigated by the FBI’s Charlotte Division, Raleigh Resident Agency. The case is being prosecuted by Trial Attorneys Lauren Bell and Molly Gaston of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Toby W. Lathan of the Eastern District of North Carolina.
Former New Rochelle Schools Director Pleads Guilty to CorruptionRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced today that JOHN C. GALLAGHER JR., the former Director of Environmental Services for the City School District of New Rochelle, pled guilty before U.S. District Judge Kenneth M. Karas in White Plains federal court to bribery in connection with a scheme to solicit bribes from an outside contractor to channel school district business to the contractor’s company.
Acting U.S. Attorney Joon H. Kim said: “As he admitted today, John Gallagher demanded and received more than $150,000 in cash bribes from a contractor for the school district where Gallagher worked. As a school district employee, Gallagher was a public servant, whose job it was to do what was in the best interest of schoolchildren and taxpayers. Instead, Gallagher corruptly did what was in his own interests, lining his pockets with bribes. Combatting public corruption at all levels in government remains one of the Office’s top priorities.”
According to the allegations contained in the Indictment charging GALLAGHER and in the Information to which Mauro Zonzini pled guilty on May 9, 2017, as well as statements made in related court filings and proceedings:
The City School District of New Rochelle (the “School District”), which receives federal benefits significantly in excess of $10,000 each year, has a Buildings and Grounds Department. It is responsible for, among other things, maintenance and repair of facilities used by the School District to educate the children. To do certain maintenance and repair work, the School District uses outside contractors.
Among the outside contractors used by the School District are companies with specialties – in, for example, masonry, electrical work, plumbing, and carpentry – sometimes referred to as “bid vendors” or “time and materials” contractors. These contractors bid annually, using set rates, and if awarded contracts, are paid by the School District to handle any projects within the contractors’ specialties that do not exceed a certain threshold cost. (As of 2009, that amount, per New York State law, was $35,000.) A more costly project that exceeds the threshold is offered for bid and awarded to the lowest responsible bidder, unless the project is deemed a health and safety emergency (i.e., a major plumbing leak during the school year), in which case, the time and materials vendor may be asked to do the job, regardless of the cost.
GALLAGHER, the defendant, was the School District’s Director of Environmental Services, overseeing the School District’s buildings and grounds. To fill this position, the School District contracted with a company that provided, among other things, management services (“Company-1”). GALLAGHER, as an employee of Company-1, was thereby made the School District’s Director of Environmental Services, and worked full-time in the School District, as its agent, with authority to act on its behalf. GALLAGHER, as Director of Environmental Services, had influence over which contractors were awarded work by the School District, and over whether, when, and how contractors were assigned work and paid for work.
Mauro Zonzini owned and wholly controlled a construction company in Westchester County (the “Company”). The Company contracted with the School District to do masonry work, and was hired each year by the School District as its time and materials contractor for masonry work.
From in or about 2009 through in or about 2013, GALLAGHER engaged in a corrupt, criminal scheme, in which he solicited, demanded, and accepted bribes in the form of cash payments, intending to be influenced and rewarded in connection with the School District’s business and transactions with the Company. The bribe payments that GALLAGHER solicited, demanded, and accepted were paid by Zonzini. Routinely, after the School District paid the Company for work performed, GALLAGHER met in person with Zonzini in a parking lot, where Zonzini provided GALLAGHER with a kickback in the amount of 10 percent of the payment the Company had received from the School District. In this way, GALLAGHER received dozens of cash bribe payments from Zonzini, over the course of at least approximately four years, which together amounted to more than $150,000. GALLAGHER solicited, demanded, and accepted the bribe payments intending to be influenced in and rewarded for the School District’s decisions to award the Company contracts for masonry work, to assign masonry projects to the Company, and to make timely payment to the Company.
To avoid detection of his corrupt scheme, GALLAGHER concealed the cash bribe payments he received from Zonzini. GALLAGHER did so, as he admitted during a secretly recorded conversation, by keeping the payments “in my car or in my trunk.” In some instances he used the cash to make payments directly toward living expenses, without depositing it in his bank account. For example, during the corrupt scheme, GALLAGHER used the bribe money to make credit card payments, car payments, and, as he admitted during the secretly recorded conversation, “I paid for some college.”
* * *
GALLAGHER, 53, of Harrisburg, Pennsylvania, pled guilty to one count of bribery, in violation of Title 18, United States Code, Section 666(a)(1)(B), which carries a maximum sentence of 10 years 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.
GALLAGHER’s sentencing is scheduled for January 9, 2018, at 2:00 p.m., before Judge Karas.
Zonzini is scheduled to be sentenced on February 16, 2018, at 10:30 a.m., before Judge Nelson S. Román.
Mr. Kim praised the outstanding investigative efforts of the United States Postal Inspection Service, the Internal Revenue Service, Criminal Investigation, and the Office’s criminal investigators. He also thanked the U.S. Department of Education’s Office of Inspector General for its assistance.
The case is being handled by the Office’s White Plains Division. Assistant U.S. Attorneys Kathryn Martin and Benjamin Allee are in charge of the prosecution.
GALLAGHER’s sentencing is scheduled for January 9, 2018, at 2:00 p.m., before Judge Karas.
Zonzini is scheduled to be sentenced on February 16, 2018, at 10:30 a.m., before Judge Nelson S. Román.
Mr. Kim praised the outstanding investigative efforts of the United States Postal Inspection Service, the Internal Revenue Service, Criminal Investigation, and the Office’s criminal investigators. He also thanked the U.S. Department of Education’s Office of Inspector General for its assistance.
The case is being handled by the Office’s White Plains Division. Assistant U.S. Attorneys Kathryn Martin and Benjamin Allee are in charge of the prosecution.
Former Military Contractor Found Guilty of Fraud ChargesRead the Press Release
Danville, VIRGINIA – The former owner and chief executive officer of an armored vehicle company with offices in Danville and Canada, was found guilty yesterday evening in the United States District Court for the Western District of Virginia in Danville of all federal charges levied against him, Acting United States Attorney Rick A. Mountcastle announced.
William R. Whyte, 72, of Ontario, Canada, was found guilty yesterday following a two-week jury trial on three counts of major fraud against the United States, three counts of wire fraud and three counts of false claims.
“Today’s jury verdict was the result of the outstanding teamwork among the United States Attorney’s Office, the Department of Justice’s Fraud Section, the Defense Criminal Investigative Service, and the Federal Bureau of Investigation. It represents another step in the battle against fraud on the Department of Defense. The defendant put his personal financial interests ahead of the safety of our brave men and women in uniform who risked their lives serving in Iraq,” Acting United States Attorney Mountcastle said. “I commend the outstanding work of AUSA Carlton, Trial Attorney Cottingham, the Defense Criminal Investigative Service, and the Federal Bureau of Investigation.”
“The Defense Criminal Investigative Service remains vigilant to detect and disrupt the contamination of the military supply chain with defective parts and equipment. The fraud perpetrated in this matter could have resulted in the death or injury of American service members, impacting military operations in Iraq. Along with our investigative partners, DCIS continues to aggressively pursue those who place our warfighters at risk,” said Special Agent in Charge Robert E. Craig, Jr, DCIS Mid-Atlantic Field Office
“Stealing from taxpayers by defrauding the government is bad enough. Doing it in a way that imperils our warfighters and delivers to them equipment which is faulty or insufficient - that's a special kind of despicable,” Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Division said today. “Whyte exposed our heroes and knew his Armet Armored Vehicles weren't up to the task of protecting them. I hope this case sends a message to those who contract with the government to provide essential equipment to our troops in support of their critical mission; the FBI will be on your trail if you betray them this way and steal from the taxpayers who fund them. I want to thank our partners at DCIS, the Department of Justice, and the United States Attorney's Office for the Western District of Virginia for today's outcome in this case.”
According to evidence presented at trial by AUSA Heather L. Carlton and Trial Attorney Caitlin Cottingham, Whyte was the owner and chief executive officer of Armet Armed Vehicles, Inc. Armet entered into a $4.8 million contract in April 2006 to provide the Department of Defense with 24 armored vehicles for use in Iraq. In June 2006, Armet entered into a second contract, valued at $1.6 million, to deliver an additional eight armored vehicles. These vehicles were to be used as security vehicles to Iraqi “Tier 1” dignitaries, who were part of the then-newly elected government to replace Saddam Hussein and who regularly traveled by motorcade through a “hostile and dangerous environment.”
Both contracts included specific requirements for the armoring of the vehicles, including that each vehicle be reinforced to a standard at which an armor-piercing bullet could not penetrate the passenger compartment and ceiling. In addition, the contracts required the undercarriage of each armored truck have mine plating protection that could withstand explosions underneath the vehicles. Finally, the contracts required the armored vehicles to have run-flat tires, so they could continue to operate should their tires be shot out or otherwise damaged.
Despite the requirement in the contract that the first 24 armored gun trucks be delivered by July 31, 2006, Whyte and Armet failed to ship a single vehicle by that deadline. Armet ultimately supplied six armored vehicles after the contract deadline and was paid $ 2,019,454, including an approximately $824,000 progress payment requested by Whyte. The prosecutors also presented evidence that Whyte intentionally misrepresented other issues to United States military officers about the contracts and vehicles.
None of the armored trucks delivered by Armet and Whyte met the ballistic and blast protection requirements of the contracts, despite the defendant’s claims that the vehicles met the standards. Whyte knew that each of the six armored trucks failed to meet the required standards and that they were intentionally under armored.
The investigation of the case was conducted by the Defense Criminal Investigative Service, the Special Inspector General for Iraq Reconstruction, the Department of Justice’s Fraud Section, and the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Heather L. Carlton and Department of Justice Fraud Section Trial Attorney Caitlin Cottingham.
Former McKeesport Resident Charged with Drug and Gun Law ViolationsRead the Press Release
PITTSBURGH – One former Allegheny County resident has been indicted by a federal grand jury in Pittsburgh on charges of violating federal narcotics and firearms laws, Acting United States Attorney Soo C. Song announced today.
The three-count indictment named Deondre Lee Purter, age 23, formerly of McKeesport, PA as the sole defendant.
According to the indictment, on September 15, 2017, Purter possessed with intent to distribute quantities of fentanyl, carfentanil, and cocaine base. Also on September 15, 2017, Purter, a convicted felon, was in possession of firearms in furtherance of a drug trafficking crime. As a convicted felon, Purter is prohibited by federal law from possessing a firearm.
The law provides for a mandatory minimum sentence of not less than five years in prison to a maximum of life, and a fine of up to $1,500,000. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses, and the criminal history, if any, of the defendant.
Assistant United States Attorney Timothy M. Lanni is prosecuting this case on behalf of the government.
The Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Drug Enforcement Agency conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former Fresno County Administrator Pleads Guilty to Stealing Health Care FundsRead the Press Release
FRESNO, Calif. — Christina Hernandez, 39, of Las Vegas, Nevada, pleaded guilty today to embezzlement from a health care benefits program, United States Attorney Phillip A. Talbert announced.
According to the plea agreement, Hernandez was a provider relations specialist at the Fresno County Department of Behavioral Health, which was responsible for administering mental health service benefits for Fresno County’s Medi-Cal beneficiaries. As a provider relations specialist, Hernandez was responsible for reviewing and approving claim forms from private mental health care providers who provide services to Medi-Cal beneficiaries in Fresno County. To steal funds from Fresno County, Hernandez submitted claim forms for medical services that were never provided. She then took the payment checks for those fake services and cashed the checks at check-cashing stores in Fresno for her personal benefit. In addition, Hernandez stole payment checks written to doctors for actual medical services provided. She also cashed those checks at convenience stores in Fresno for her personal benefit In total, Hernandez stole approximately $98,560 from the Fresno County Department of Behavioral Services.
This case was the product of an investigation by the Federal Bureau of Investigation and the Fresno County Sheriff’s Office. Assistant United States Attorney Grant B. Rabenn is prosecuting the case.
Hernandez is scheduled to be sentenced by U.S. District Judge Dale A. Drozd on January 8, 2018. Hernandez faces a maximum statutory penalty of ten years in prison and a $250,000 fine. Any 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.
Former Employee of Transcontinental Railroad Company Found Guilty of Damaging Ex-Employer’s Computer NetworkRead the Press Release
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and Acting U.S. Attorney Gregory G. Brooker of the District of Minnesota announced the conviction of a former employee of Canadian Pacific Railway for causing intentional damage to Canadian Pacific’s computer network.
Christopher Victor Grupe, 46, of Minneapolis, Minnesota, was charged on April 11, with one count of intentional damage to a protected computer and on Oct. 6, following a five-day trial, was found guilty by a federal jury in Minneapolis, Minnesota. A sentencing date has not been set.
As proven at trial, from September 2013 until December 2015, Grupe was employed as an IT professional by Canadian Pacific Railway (CPR), a transcontinental railroad company headquartered in Alberta, Canada, with U.S. headquarters in Minneapolis, Minnesota. On Dec. 15, 2015, following a 12-day suspension, Grupe was notified by CPR management that he was going to be fired due to insubordination. However, at his request, Grupe was instead allowed to resign, effective that same day. In his resignation letter, Grupe indicated that he would return all company property, including his laptop, remote access device, and access badges, to the CPR office.
As proven at trial, on Dec. 17, 2015, before returning his laptop and remote access device, Grupe used both to gain access to the CPR network’s core “switches” – high-powered computers through which critical data in the CPR network flowed. Once inside, Grupe strategically deleted files, removed administrative-level accounts, and changed passwords on the remaining administrative-level accounts, thereby locking CPR out of these network switches. Grupe then attempted to conceal his activity by wiping the laptop’s hard drive before returning it to CPR.
On Jan. 6, 2016, while trying to address a networking problem, the CPR network staff discovered that they were unable to access the main network switches. After CPR IT staff was able to regain access to the switches through a risky, but successful, rebooting procedure, they discovered evidence in logging data stored in the memory of the switches connecting the damage to Grupe. CPR hired an outside computer security company to identify the source and scope of the intrusion as well as conduct an incident analysis, which also connected the damage to Grupe. In total, CPR experienced a financial loss of approximately $30,000 as a result of Grupe’s conduct.
This case is the result of an investigation conducted by the FBI Minneapolis field office, with assistance from the Cybercrime Laboratory of the Criminal Division’s Computer Crime and Intellectual Property Section.
Trial Attorney Aaron R. Cooper of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Timothy C. Rank of the District of Minnesota are prosecuting the case.
Former Employee of Transcontinental Railroad Company Found Guilty of Damaging Ex-Employer’s Computer NetworkRead the Press Release
Acting United States Attorney Gregory G. Brooker of the District of Minnesota and Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division today announced the conviction of a former employee of Canadian Pacific Railway for causing intentional damage to Canadian Pacific’s computer network. CHRISTOPHER VICTOR GRUPE, 46, was charged on April 11, 2017, with one count of intentional damage to a protected computer and on October 6, 2017, following a five-day trial, was found guilty by a federal jury in Minneapolis, Minn. A sentencing date has not been set.
“IT professionals with both substantial technical skills and trusted high-level access to the computer systems on which they work can cause significant and potentially catastrophic damage to businesses and critical infrastructure, and so when they use their skills and access to commit crimes there should be real consequences,” said Assistant U.S. Attorney Tim Rank. “This guilty verdict, which was the result of a thorough investigation by the FBI, demonstrates that there will be. I am grateful to the jury for their time and service.”
As proven at trial, from September 2013 until December 2015, GRUPE was employed as an IT professional by Canadian Pacific Railway (CPR), a transcontinental railroad company headquartered in Alberta, Canada, with US headquarters in Minneapolis, Minnesota. On December 15, 2015, following a twelve-day suspension, GRUPE was notified by CPR management that he was going to be fired due to insubordination. However, at his request, GRUPE was instead allowed to resign, effective that same day. In his resignation letter, GRUPE indicated that he would return all company property, including his laptop, remote access device, and access badges, to the CPR office.
However, on December 17, 2015, before returning his laptop and remote access device, GRUPE used both to gain access to the CPR computer network’s core “switches” – high-powered computers through which critical data in the CPR network flowed. Once inside, GRUPE strategically deleted files, removed administrative-level accounts, and changed passwords on the remaining administrative-level accounts, thereby locking CPR out of these network switches. GRUPE then attempted to conceal his activity by wiping the laptop’s hard drive before returning it to CPR.
On January 6, 2016, while trying to address a networking problem, the CPR network staff discovered that they were unable to access the main network switches. After CPR IT staff was able to regain access to the switches through a risky, but successful, rebooting procedure, they discovered evidence in logging data stored in the memory of the switches connecting the damage to GRUPE. CPR hired an outside computer security company to identify the source and scope of the intrusion as well as conduct an incident analysis, which also connected the damage to GRUPE. In total, CPR experienced a financial loss of approximately $30,000 as a result of GRUPE’S conduct.
This case is the result of an investigation conducted by the Federal Bureau of Investigation, with assistance from the Digital Forensic Laboratory of the Criminal Division’s Computer Crime and Intellectual Property Section.
Assistant United States Attorney Timothy C. Rank of the District of Minnesota and Trial Attorney Aaron R. Cooper of the Criminal Division’s Computer Crime and Intellectual Property Section are prosecuting the case.
Defendant Information:
CHRISTOPHER VICTOR GRUPE, 46
Minneapolis, Minn.
Convicted:
- Intentional damage to a protected computer, 1 count
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- Intentional damage to a protected computer, 1 count
Former Cannonball Tribal Councilman Sentenced on Aggravated Sexual Abuse and Incest ChargesRead the Press Release
BISMARCK – Christopher C. Myers announces that on October 6, 2017, former Cannonball Tribal Councilman ROBERT FOOL BEAR, age 55, was sentenced before Chief Judge Daniel L. Hovland on three Counts of Aggravated Sexual Abuse of a Child and one Count of Incest. Fool Bear was sentenced to serve 30 years imprisonment, to be followed by 10 years of supervised release, and was further ordered to pay a total of $400 to the Crime Victims’ Fund.
This case came to the attention of law enforcement after the victim reported to law enforcement that Fool Bear had been sexually abusing her for approximately seven years, including on one occasion kicking her in the ribs. The investigation was conducted by agents from the FBI, as well as the Bureau of Indian Affairs.This case was prosecuted by Assistant United States Attorney Gary Delorme.
Florida Resident Pleads Guilty to Stolen Identity Refund FraudRead the Press Release
A Lauderhill, Florida, man pleaded guilty today to aggravated identity theft and conspiring to use stolen IDs to file fraudulent tax returns, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida.
According to documents filed with the court, from approximately 2008 through January 2015, in Broward and Miami-Dade Counties, Evens Julien and others, used stolen IDs, including the personal identifying information of prisoners and deceased individuals, to file over 2,000 tax returns with the Internal Revenue Service (IRS). These fraudulent returns sought more than $2 million in refunds. Julien and his co-conspirators recruited others to obtain Electronic Filing Identification Numbers (EFIN) from the IRS in their names and used the EFINs to file the fraudulent returns. They directed the refunds to debit cards and treasury checks and had them mailed to South Florida addresses. They then cashed the fraudulently obtained refund checks at check cashing stores and used Western Union and ATMs to withdraw the funds.
Sentencing is scheduled for Dec. 27 before U.S. District Court Judge Federico A. Moreno. Julien faces a statutory maximum sentence of five years in prison for the conspiracy charge and a mandatory minimum sentence of two years in prison for the aggravated identity theft charge. He also faces a period of supervised release, restitution and monetary penalties.
Acting Deputy Assistant Attorney General Goldberg and Acting U.S. Attorney Greenberg commended special agents of IRS Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Neil Karadbil and Assistant Chief Greg Tortella of the Tax Division, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Florida Resident Pleads Guilty to Stolen Identity Refund FraudRead the Press Release
A Lauderhill, Florida, man pleaded guilty today to aggravated identity theft and conspiring to use stolen IDs to file fraudulent tax returns, announced Acting U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida and Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.
According to documents filed with the court, from approximately 2008 through January 2015, in Broward and Miami-Dade Counties, Evens Julien and others, used stolen IDs, including the personal identifying information of prisoners and deceased individuals, to file over 2,000 tax returns with the Internal Revenue Service (IRS). These fraudulent returns sought more than $2 million in refunds. Julien and his co-conspirators recruited others to obtain Electronic Filing Identification Numbers (EFIN) from the IRS in their names and used the EFINs to file the fraudulent returns. They directed the refunds to debit cards and treasury checks and had them mailed to South Florida addresses. They then cashed the fraudulently obtained refund checks at check cashing stores and used Western Union and ATMs to withdraw the funds.
Sentencing is scheduled for Dec. 27 before U.S. District Court Judge Federico A. Moreno. Julien faces a statutory maximum sentence of five years in prison for the conspiracy charge and a mandatory minimum sentence of two years in prison for the aggravated identity theft charge. He also faces a period of supervised release, restitution and monetary penalties.
Acting U.S. Attorney Greenberg and Acting Deputy Assistant Attorney General Goldberg commended special agents of IRS Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Neil Karadbil and Assistant Chief Greg Tortella of the Tax Division, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Federal Jury Convicts Lawyer on Charges of Defrauding an Elderly Couple and a Bank to Prevent Foreclosure on Aurora PropertyRead the Press Release
CHICAGO — A lawyer licensed to practice in Illinois has been convicted on federal fraud charges for scheming to provide falsified documents to prevent foreclosure on a nearly $2 million parcel of land in Aurora. The fraud left an elderly couple out of $300,000.
The jury in federal court in Chicago convicted ROBERT JON SCHLYER, 47, of Portage, Ind., of two counts of wire fraud affecting a financial institution, and one count of bank fraud.
Schlyer’s fraud scheme occurred while representing two clients, co-schemers KEVIN LEBEAU and BRIAN BODIE, in connection with a foreclosure lawsuit. Evidence at trial revealed that Schlyer provided false and fraudulent documents to an elderly couple and Amcore Bank in order to postpone foreclosure on the Aurora property.
The jury returned the guilty verdicts on Oct. 6, 2017, after a four-day trial. U.S. District Judge Amy J. St. Eve set sentencing for Jan. 31, 2018, at 9:15 a.m. Each count carries a maximum sentence of 30 years in prison.
The conviction was announced by Joel R. Levin, Acting United States Attorney for the Northern District of Illinois; and John P. Selleck, Acting Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.
According to evidence at trial, in 2004 Amcore Bank received a mortgage on the 10.4-acre property in Aurora after issuing a $1.9 million loan for the refinancing and redevelopment of the property. Lebeau and Bodie executed a full personal guarantee for the loan. By the fall of 2005, Lebeau and Bodie had failed to make the required payments, the loan was in default, and the bank filed a foreclosure lawsuit to seize the property.
During the scheme, Schlyer, who acted as Lebeau’s and Bodie’s attorney in the foreclosure suit, obtained $300,000 from an elderly retired couple by providing them with fake documents that made it seem like they were making a safe investment in the redevelopment and that it would be secured by a trust. Schlyer also claimed to be the trustee of the purported trust. In reality, there was no trust and Schlyer was not a trustee. Schlyer and his co-schemers also concealed from the elderly couple the foreclosure suit and LeBeau’s and Bodie’s inability to pay the bank debt. A portion of funds obtained from the elderly couple through the fraud was used to pay down the bank loan.
Together with his co-schemers, Schlyer furnished fraudulent and fabricated documents to the bank, including forged documents that made it appear that investors had committed approximately $1.5 million to the redevelopment of the property. Eventually the foreclosure occurred, and the property was sold in 2010 at a significant loss to the bank.
LeBeau, of Aurora, and Bodie, of Chicago, were previously convicted in the case and are awaiting sentencing before U.S. District Judge Robert W. Gettleman.
The government is represented by Assistant U.S. Attorneys Kartik K. Raman and Amarjeet S. Bhachu.
Earlton Man Sentenced to Time Served on Firearm ChargeRead the Press Release
ALBANY, NEW YORK – Robert Twiss, 59, of Earlton, New York, was sentenced today to time served (approximately five months) for possessing a firearm as a felon.
The announcement was made by Acting United States Attorney Grant C. Jaquith and Vadim D. Thomas, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation.
As part of his March 20, 2017 guilty plea, Twiss admitted that on October 24, 2016, he possessed a Plainfield M-1, Model 41 semi-automatic rifle on his residential property in Earlton.
Senior United States District Judge Thomas J. McAvoy also imposed a three-year term of supervised release.
This case was investigated by the FBI’s Joint Terrorism Task Force (JTTF) and prosecuted by Assistant U.S. Attorney Richard Belliss.