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25 October 2017
Roanoke Man Sentenced on Methamphetamine ChargesRead the Press Release
Roanoke, VIRGINIA – A Roanoke man, who trafficked large quantities of methamphetamine from Arizona into the Roanoke Valley for redistribution for resale, was sentenced today in the United States District Court for the Western District of Virginia in Roanoke, Acting United States Attorney Rick A. Mountcastle announced.
Curtis Ronnie Hilton, 45, was sentenced today to a term of 220 months’ imprisonment. Hilton previously entered guilty pleas to one count of conspiracy to possess with the intent to distribute and to distribute 500 grams or more of methamphetamine and one count of being a previously convicted felon illegally in possession of a firearm. Moreover, Mr. Hilton was also found to be in violation of his supervised release. He was sentenced to an additional term of imprisonment of 60 months for that violation.
According to evidence presented at previous hearings by Assistant United States Attorney Ashley B. Neese, from at least April 2015 until June 2016, Hilton, and others, conspired to distribute methamphetamine in and around the Roanoke Valley. If this matter had gone to trial, the United States would have proven that Hilton had a source of supply in Arizona that was shipping methamphetamine to the defendant for redistribution throughout the Western District of Virginia.
Evidence would have also shown that Hilton was a large-scale distributor who directed numerous other co-conspirators to distribute the methamphetamine he was receiving upon its arrival in the Western District of Virginia. Several of them, including Brandi Doss and Joy Mason, among others, have been convicted of federal methamphetamine charges in a corresponding prosecution.
The investigation of the case was conducted by the Drug Enforcement Administration, the Virginia State Police, and the Roanoke City Police Department. Assistant United States Attorney Ashley B. Neese prosecuted the case for the United States.
Roanoke Man Sentenced for Stealing from the Railroad Retirement BoardRead the Press Release
Roanoke, VIRGINIA – A Roanoke man, who worked while receiving disability benefits from the Railroad Retirement Board, was sentenced today in the United States District Court for the Western District of Virginia in Roanoke, Acting United States Attorney Rick A. Mountcastle announced.
James Sexton, 67, was sentenced today to six months home confinement, two years’ probation, 200 hours of community service, a $100,000 fine, a $100 special assessment and restitution in the amount of $454,645. Sexton previously pleaded guilty to one count of theft of government money. The defendant has already paid in full $454,645 in restitution prior to the sentencing hearing.
According to evidence presented at a previous hearing by Assistant United States Attorney Charlene R. Day, Sexton began receiving disability benefits from the Railroad Retirement Board in 1997 and acknowledged that he was required to report any work he performed or earnings to the government. However, he admitted yesterday that he received $454,645 in Railroad Retirement Board benefits earned while working with various financial companies. Sexton’s employment with those companies was not disclosed to the Railroad Retirement Board.
The investigation of the case was conducted by the Railroad Retirement Board, Office of the Inspector General. Assistant United States Attorney Charlene R. Day prosecuted the case for the United States.
Removed Alien Charged with Immigration ViolationRead the Press Release
PITTSBURGH - A citizen of El Salvador has been indicted by a federal grand jury in Pittsburgh on a charge of violating federal immigration laws, Acting United States Attorney Soo C. Song announced today.
The one-count indictment, returned on October 24, named Mario Nelson Reyes-Romero, age 27, of El Salvador, as the sole defendant.
According to the indictment presented to the court, on or about October 3, 2017, Reyes-Romero was found to be illegally present in Aliquippa, Pennsylvania, having previously been removed from the United States on or about August 29, 2011.
The law provides for a maximum total sentence of 20 years in prison, a fine of $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, if any, of the defendant.
Assistant United States Attorney Adam N. Hallowell is prosecuting this case on behalf of the government.
The U.S. Department of Homeland Security, Immigration and Customs Enforcement 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.
Real Estate Investor Agrees to Plead Guilty to Bid Rigging at Public Foreclosure Auctions in Northern CaliforniaRead the Press Release
A real estate investor pleaded guilty for his role in a conspiracy to rig bids at public real estate foreclosure auctions in Northern California, the Department of Justice announced.
Abraham S. Farag, who was charged in an indictment returned by a federal grand jury in the U.S. District Court for the Northern District of California on October 22, 2014, pleaded guilty to one count of bid rigging.
According to court documents, Farag participated in a conspiracy to rig bids by agreeing to refrain from bidding against other co-conspirators at public real estate foreclosure auctions in San Mateo County. The conspiracy began no later than August 2008 and continued until January 2011.
The primary purpose of the conspiracy was to suppress competition in order to obtain selected properties offered at San Mateo County public foreclosure auctions at noncompetitive prices.
Today’s guilty plea is the result of the Department’s ongoing investigation into bid rigging at public real estate foreclosure auctions in San Francisco, San Mateo, Contra Costa, and Alameda counties, California. To date, 74 individuals have pleaded guilty or been convicted at trial.
These investigations are being conducted by the Antitrust Division’s San Francisco Office and the FBI’s San Francisco Office. Anyone with information concerning bid rigging or fraud related to real estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at 415-934-5300 or call the FBI tip line at 415-553-7400.
RI Doctor Admits to Healthcare Fraud, Accepting Kickbacks for Prescribing Highly Addictive Version of FentanylRead the Press Release
WASHINGTON — Dr. Jerrold N. Rosenberg, 63 of North Providence and Jamestown, R.I., the operator of a now-defunct pain management practice in Rhode Island, pleaded guilty in U.S. District Court in Providence, R.I., today to conspiring to solicit and receive kickbacks in connection with his prescribing of the drug Subsys, a fast-acting, powerful, and highly-addictive version of the opioid drug Fentanyl that is administered as an under-the-tongue spray, and to committing healthcare fraud.
“Doctors who engage in healthcare fraud violate their oaths and put greed ahead of their patients,” said Deputy Attorney General Rod Rosenstein. “The Department of Justice is relentless in pursuing healthcare fraudsters. Earlier this year we conducted the largest healthcare fraud takedown in American history, charging more than 400 defendants with $1.3 billion in fraud, much of it related to our country’s ongoing drug epidemic. Since then, Attorney General Sessions assigned a dozen experienced prosecutors to focus on opioid-related health care fraud. This conviction is another step toward our goals of saving taxpayer dollars and protecting the American people from deadly drugs.”
Subsys is manufactured by Arizona based company Insys Therapeutics, Inc. (“Insys”). This spray was approved by the U.S. Food and Drug Administration in 2012 exclusively for “the management of breakthrough cancer pain in . . . patients who are already receiving and who are already tolerant of opioid therapy for their underlying persistent cancer pain.” As a result, many insurance companies require a diagnosis of breakthrough cancer pain before approving coverage of the drug, which costs approximately $2,000 to over $16,000 for a thirty day supply.
Appearing before U.S. District Judge John J. McConnell, Jr., Rosenberg admitted to the Court that he participated in a healthcare fraud scheme in which he falsely and fraudulently indicated that his patients had breakthrough pain from cancer when they did not, in order to secure insurance approvals for prescriptions of Subsys. As an example, Rosenberg admitted that in 2012, as part of the scheme, he falsely claimed that one patient suffered from cancer pain from basal cell carcinoma. While the patient had in fact had a potential skin cancer lesion on his nose removed many years before, it had not recurred, and was wholly unrelated to his pain. Rosenberg admitted that, in total, the healthcare fraud scheme resulted in losses of over $750,000; in many cases, the cost of the drug was reimbursed, at least in part, by the Medicare program.
Rosenberg also admitted that, between 2012 and 2015, he conspired with Insys officials to receive kickbacks, in the form of purported speaker fees, from the manufacturer of the spray. Rosenberg admitted that he accepted these payments, which totaled over $188,000. In addition, according to court documents, Rosenberg’s son was a sales representative for Insys Therapeutics from June 2012 – September 2013 and made substantial amounts in commissions as a result of the defendant’s prescribing Subsys to his patients. Rosenberg admitted that the speaking fees he received from Insys were a significant motivating factor in his decision to prescribe Subsys to his patients.
Rosenberg’s guilty plea to healthcare fraud and conspiracy to receive kickbacks is announced by Deputy Attorney General Rod Rosenstein; Acting U.S. Attorney for the District of Rhode Island Stephen G. Dambruch; Phillip Coyne, Special Agent-in-Charge of the Boston Office of Inspector General for the U.S. Department of Health and Human Services (HHS-OIG); and Rhode Island Attorney General Peter F. Kilmartin.
“These provider kickbacks pervert medical decision making and undermine the integrity of government health programs,” said Phillip Coyne, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “We will aggressively work with both Federal and State Medicaid Fraud Control Unit law enforcement agencies to fight the opioid scourge.”
“Patients trusted Dr. Rosenberg to make medical decisions based on the best available treatment, not based on speaker fees, kickbacks and other financial incentives. He violated the law and his oath as a physician to do no harm when he placed greed over patient care, thinking little of the long-term consequences of patients taking this extremely powerful, highly-addictive opioid,” said Rhode Island Attorney General Peter F. Kilmartin. “Our office, working with our federal, state and local law enforcement partners, is committed to rooting out fraud and abuse in our healthcare system.”
Rosenberg is scheduled to be sentenced on January 16, 2018. The statutory maximum sentence with respect to the healthcare fraud scheme is up to 10 years imprisonment; a maximum sentence of five years imprisonment on the charge of conspiracy to accept kickbacks, followed by up to three years of supervised release and a fine of up to $250,000.00 on each charge. Under the terms of a plea agreement filed with the Court, Rosenberg has agreed to the entry of a restitution order in the amount of $754,736.48.
The case is being prosecuted in the District of Rhode Island by Assistant U.S. Attorneys Lee H. Vilker and Zachary A. Cunha.
The matter was investigated by the United States Attorney’s Office for the District of Rhode Island, the U.S. Department of Health and Human Services Office of Inspector General and the Rhode Island Department of Attorney General’s Medicaid Fraud and Patient Abuse Unit.###
Pittston Man Sentenced to Eight Years’ Imprisonment for Role in Drug ConspiracyRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that on October 23, 2017, United States District Court Judge Malachy E. Mannion sentenced Richard Chalmers, age 41, of Pittston, Pennsylvania to 96 months’ imprisonment for his role in a drug conspiracy.
According to United States Attorney Bruce D. Brander, Chalmers conspired to distribute approximately 60 grams of heroin throughout Northeastern Pennsylvania between February and April of 2016. This amount of drugs equates to approximately 2,400 personal doses of heroin.
Chalmers was indicted by a federal grand jury on October 25, 2016, and pleaded guilty pursuant to a plea agreement on January 24, 2017.
The case was investigated by the Drug Enforcement Administration, the Federal Bureau of Investigation, the Pennsylvania State Police, and the Scranton and Wilkes-Barre Police Departments. Assistant United States Attorney Evan Gotlob prosecuted 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.
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Pittsburgh Man Charged with Robbing Brentwood Bank Armed with a KnifeRead the Press Release
PITTSBURGH - One resident of Allegheny County, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh, Pennsylvania, on a charge of armed bank robbery, Acting United States Attorney Soo C. Song announced today.
The one-count indictment, returned on October 24, named Gary William White, age 20, of Pittsburgh, Pennsylvania, as the sole defendant.
According to the indictment, on or about September 20, 2017, White robbed PNC Bank, located at 3701 Saw Mill Run Boulevard, Pittsburgh, PA 15227, with a deadly weapon, namely a knife. PNC Bank is insured by the Federal Deposit Insurance Corporation.
The law provides for a maximum total sentence of 25 years in prison, a fine of $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, if any, of the defendant.
Assistant United States Attorney Shanicka L. Kennedy is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation, along with the Allegheny County Police and Brentwood Police Departments, 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 Man Charged with Robbing Bank, Illegally Possessing Gun and AmmunitionRead the Press Release
PITTSBURGH - One resident of Allegheny County, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh, Pennsylvania, on charges of bank robbery, possession of a firearm and ammunition by a convicted felon and possession of a firearm in furtherance of a crime of violence, Acting United States Attorney Soo C. Song announced today.
The three-count indictment, returned on October 24, named Christian Elijah Moore, age 28, of Pittsburgh, Pennsylvania, as the sole defendant.
According to the indictment, on or about September 5, 2017, Moore robbed First National Bank, located at 116 West 8th Avenue, Homestead, PA 15120. The indictment also alleges that in furtherance of the bank robbery, Moore was in possession of a firearm and ammunition, following a felony conviction in 2011. Federal law prohibits a person convicted of a crime punishable by in excess of one year imprisonment from possessing a firearm or ammunition.
The law provides for a maximum total sentence of not less than five years and up to life in prison, a fine of $250,000.00, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history of the defendant.
Assistant United States Attorney Shanicka L. Kennedy is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation, along with the Allegheny County Police and Homestead Police Departments, 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.
Peabody Man Pleads Guilty to Possessing Child PornographyRead the Press Release
BOSTON – A Peabody man pleaded guilty today in federal court in Boston to possessing child pornography, including images and videos of infants and toddlers being sexually abused.
Daniel Baldwin, 26, pleaded guilty to one count of possession of child pornography. U.S. District Court Judge Leo T. Sorokin scheduled sentencing for Jan. 25, 2018.
Following an investigation into the online trade of child pornography through peer to peer networks, federal agents executed a search warrant at Baldwin’s home in Peabody on April 4, 2017, where they seized digital devices containing approximately 1500 videos containing child pornography. Baldwin is a Level 2 sex offender based on a 2013 Massachusetts state conviction for possession of child pornography.
The charge provides for a mandatory minimum sentence of 10 years and up to 20 years in prison, a minimum of five years and up to a lifetime of supervised release, and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney William D. Weinreb and Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Office, made the announcement today. Assistant U.S. Attorney Anne Paruti, Weinreb’s Project Safe Childhood Coordinator and a member of the Major Crimes Unit, is prosecuting the case.
The case was brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys’ Offices and DOJ’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.
Opening Statement by U.S. Attorney R. Trent Shores Before the Senate Committee on Indian AffairsRead the Press Release
Chairman Hoeven, Vice-Chairman Udall, and Members of the Committee: Thank you for the opportunity to testify before you today about three important bills pertaining to critical justice issues in Indian Country: S. 1870, Securing Urgent Resources Vital to Indian Victim Empowerment Act 2017; S. 1953, Reauthorization of the Tribal and Law Order Act of 2010; and S. 1942, “Savanna’s Act.” It is truly an honor to be here, not only as a United States Attorney representing the Justice Department, but also as an Oklahoman and as a member of the Choctaw Nation of Oklahoma. I began my legal career at the Department’s Office of Tribal Justice, meeting with tribal leaders from across the Country and even helping to draft testimony for officials who testified before this Committee.
Fifteen years later, I am an experienced career prosecutor who has seen firsthand the very real challenges that these bills seek to address. As I reviewed the content of these bills, I am confident that we can—and will—work together to improve public safety in Native communities. It is our duty to do so as we seek to uphold our federal trust responsibility.
The three bills address some of the biggest threats to public safety in Native communities. Violent crime and substance abuse occurs at higher rates in Indian country than anywhere else in the United States. That is unacceptable. There are not enough resources to cover all of the needs of law enforcement and victim service providers working in and around Indian country. Too many correctional facilities in Indian country are overcrowded or substandard such that they cannot maintain sight and sound separation between adult and juvenile detainees. Furthermore, the need for treatment services is widespread and urgent. Like many areas of our Country, Indian communities have been plagued by the scourge of the opioid epidemic. We must improve our services and programs for Native juveniles involved in the justice system, and we need better law enforcement tools and techniques to respond to cases of missing and murdered Native peoples, especially Native women.
As the United States Attorney in the Northern District of Oklahoma, and throughout my years of experience working on tribal justice issues, I have seen and heard from tribal leaders, law enforcement, social service providers, and victims about the challenges that exist on-the-ground in Native communities. There are 39 federally recognized tribes in Oklahoma, and 14 of those are in my District. We have large tribes like the Cherokee Nation and Muscogee (Creek) Nation and smaller tribes such as the Pawnee, Miami, or Delaware Tribes. We prosecute a diverse array of violent crimes and encounter too many victims who do not have the resources they so desperately need.
As a federal prosecutor, I have stood next to a hospital bed while a victim of domestic violence recounted the horrific details of how her lip was busted, her head concussed, her tooth knocked out, her arm broken, and her eye blackened. I listened to her cry as she explained that her boyfriend had flown into a fit of rage. I remember learning that the boyfriend had a history of domestic violence and that multiple women had sought protective orders against him. And I remember the disappointment when the victim notified us that she did not want to testify for fear of repercussions. While we were still able to successfully prosecute the boyfriend in this case, far too often tribal, state, and federal prosecutions of domestic violence offenders are unsuccessful because of witness and evidentiary problems. In this and similar moments, it was crucial that I had with me federal and tribal law enforcement agents and a victim-witness specialist to ensure that we met the needs of the prosecution and the victim. Multi-jurisdictional and multi-disciplinary teams are important in these types of cases, just as they also are in sexual assault and child sexual assault prosecutions.
In 2008, I sat on the floor of a doublewide trailer in rural Oklahoma with a BIA investigator and Cherokee Nation Marshal as we tried to build rapport with a twelve-year-old girl who had been repeatedly raped by her father for a period of years. The victim had been so victimized that she communicated by adopting the characteristics of horses, that is, she whinnied, snorted, and stamped her feet. You see, the horses in the field behind her house were the only thing in her life that had not hurt her. They were her friends. After months of intense work with our prosecution team and counselors, that same little girl—and two of her friends who had also been raped by her father—bravely testified in front of a jury and in front of her father. He was found guilty and is now spending life in a federal penitentiary.
Members of the Committee, there are many more cases like these—domestic violence, sexual assaults, child abuse—that require resources to be successfully investigated and prosecuted, and to help give a voice to victims. These bills seek to provide some of those critical resources and I thank you.
Thanks to the ongoing efforts of this Committee, federal agencies, and the Tribes, we are making progress in improving public safety in Native communities. Since the passage of the Tribal Law and Order Act of 2010 we are making progress in ensuring that Tribes are able to access law enforcement databases, which is critical to meeting public safety needs. We have expanded funding and training opportunities, established more productive protocols based on our government-to-government relationship with the Tribes, and have sought to be more clearly accountable for our efforts.
In the Northern District of Oklahoma, I am blessed to have a great relationship with the fourteen federally recognized tribes. My Tribal Liaison, Shannon Bears Cozzoni, regularly travels to Indian Country where, together with other federal prosecutors, she provides a variety of training to tribal law enforcement officials to help them obtain Special Law Enforcement Commissions to enforce federal law in Indian Country. As a former tribal liaison myself, I can assure you this position is crucial for United States Attorney’s Offices and there are no more dedicated advocates for justice in Indian Country. The funding of training programs for tribal law enforcement through District-focused initiatives and the National Advocacy Center serves to improve the investigative skills of law enforcement, social service providers, and prosecutors working in Indian Country. Similarly, the creation of the Native American Issues Coordinator at the Executive Office for United States Attorneys and the formal establishment of the Office of Tribal Justice has given United States Attorneys with Indian Country in their Districts an ever-present voice in the halls of the Justice Department in DC even when we are not physically present. The Tribal Law and Order Act of 2010 has been good for Indian Country and good for those of us working to ensure justice in Indian country.
Each bill proposes new methods and refined approaches to addressing major threats to public safety. Savanna’s Act addresses a tragic set of cases: missing and murdered individuals, often women, in Indian country. The Department of Justice supports the goals of this bill and the effort to take on this dark and tragic issue. We have identified some technical issues in the course of our review. For example, Section 1 of the bill references the Automated Integrated Fingerprint Identification System, which has been replaced with the Next Generation Identification System. We welcome the opportunity to work with your staffs to assist in making some technical adjustments.
The SURVIVE Act addresses a long-time issue in Indian country: a lack of resources to support the level of victim services warranted by the levels of violent crime in Indian country. The importance of providing effective services to victims of crime cannot be overstated. From any angle—humanitarian, law enforcement, community relations—it is both right and necessary. A number of the Department of Justice comments on an earlier version of this Act were incorporated into the current bill, which we recognize and appreciate. We note that the Act includes a consultation requirement. In fact, the Department, through the Office for Victims of Crime, has already begun making plans for formal consultations and listening sessions with tribes, with the first listening session having occurred in Milwaukee on October 18, 2017. Our review of this bill is ongoing, and welcome discussion with your staffs as we make progress towards a formal Administration response.
The Tribal Law and Order Act of 2010 was a significant and extremely positive piece of legislation. As a result of that legislation, the Department of Justice is making significant progress on improving public safety in Indian country. This Committee has received previous testimony from this Department on the many ways that the 2010 Tribal Law and Order Act altered and improved the way that we work in Indian country and with our federal partners and we agree with the Committee’s efforts to do more. Our review of this bill is also ongoing, so while we do not yet have a formal position to offer we do applaud efforts to compel greater improvements in law enforcement, data sharing, and justice for Native American and Alaska Native children. We are particularly heartened that you intend to extend the Bureau of Prisons pilot project and included support for our Tribal Access Program, which will help us expand that opportunity to more Tribes.
In our review, we noted a recurring effort to improve data collection and information sharing. The Department is unequivocally in favor of efforts to improve collection of and access to data whenever we can do so without harming victim confidentiality or jeopardizing an investigation. We are working internally to find immediate opportunities for improvement. And we will continue to work with our partner agencies, with Tribes, and with your staffs on data collection and information sharing issues.
The Department is actively engaged in efforts to address the specific challenges described in the bills and is committed to working with Congress, other federal agencies, and Tribes to more effectively address them. We seek, whenever possible, to expand Tribes’ opportunities for funding, training, and technical assistance. Our partnerships with Tribes and with other agencies active in Indian country are an integral part of our daily work, which we continually review to ensure that our work is productive and focused on the needs of the Tribes.
While we have further to go, we are far ahead of many nations in recognizing and protecting the rights of native peoples. Around the world, indigenous peoples are marginalized, exploited, or threatened with death—denied basic human rights, women abused, indigenous cultures destroyed, languages lost. With your continued leadership, the United States can lead by example to promote and protect the inherent rights of indigenous people. Recently, missing and murdered indigenous women was a topic of discussion during a June meeting of the Attorneys General for the U.S., Canada, Mexico, United Kingdom, New Zealand and Australia. In that meeting, Attorney General Sessions voiced support for the creation of a working group that would allow us to expand our partnerships in addressing this grievous issue.
As indicated earlier, the Department of Justice fully supports the goals of these three bills. The bills under discussion today are clearly intended to spur further progress, specifically in support of law enforcement, in providing effective services to victims of crime, and in shedding light on the tragic number of missing and murdered individuals in Indian country. The Department’s review of the bills is ongoing; some offices have already reached out to discuss some of the technical aspects of the bills, and we welcome the opportunity to continue working with your staffs to refine language.
We have made great progress, but we know we have a ways to go before we reach our shared goal of achieving lasting public safety in Indian country. We appreciate the efforts by this Committee to ensure that legislation affecting Native communities puts Federal, State, and Tribal agencies in the best possible position to overcome barriers to public safety. Thank you again for the opportunity to appear before you today. Thank you also for the opportunity to share with you some perspective from the United States Attorney’s Office in the Northern District of Oklahoma. I am happy to answer any questions you may have.Ohio Man Pleads Guilty to Sexual Exploitation of ChildrenRead the Press Release
BOISE – Timothy Raymond Schmidt, 34, of Cincinnati, Ohio pleaded guilty yesterday in United States District Court to sexual exploitation of children, U.S. Attorney Bart M. Davis announced.
According to the plea agreement, from January 28 to April 9, 2015, Schmidt, while in Ohio, used Skype to communicate with two minor victims, ages 17 and 13, located in Valley County, Idaho. On at least 12 occasions, Schmidt persuaded, induced, and coerced the 17 year-old victim to engage in sexually explicit conduct over live Skype video transmissions. On at least 11 occasions, Schmidt persuaded, induced, and coerced the 13 year-old victim to engage in sexually explicit conduct over live Skype video transmissions.
Schmidt’s conduct was discovered by adult relatives of the victims and reported to the Valley County Sheriff’s Office. The case was referred to Homeland Security Investigations (HSI) and the Idaho Internet Crimes Against Children (ICAC) task force. ICAC detectives examined the victims’ computers and discovered 33,000 lines of archived Skype chats between Schmidt and both victims, sexually explicit images of both victims, and images of Schmidt. Within the chats, Schmidt provided personal identifying information to the victims, including his name, hometown, his place of work, where he went to college, and a description of his tattoos. ICAC detectives were also able to identify two locations in Ohio from where Schmidt had engaged in the chats.
In May 2016, HSI Agents from Idaho and Ohio served a search warrant at one of the locations in Ohio where the Skype communications originated from. Agents determined that Schmidt currently resided there. They seized computers belonging to Schmidt from the residence.
HSI Agents also contacted a resident of the second location in Ohio where Skype communications originated from, and confirmed that Schmidt had previously stayed at the residence. Agents observed items in the residence which were consistent with items the victims reported observing in the background of Schmidt’s live chats, including a Darth Vader statue and model airplanes hanging from the ceiling. An HSI forensic examiner examined Schmidt’s computers and discovered evidence that both had been used to communicate with the victims via Skype.
Sexual exploitation of a child is punishable by not less than 15, and up to 30 years in prison, a maximum fine of $250,000, at least 5 years and up to lifetime of supervised release, and a $5,100 special assessment.
Sentencing is set for January 31, 2018, before Chief U.S. District Judge B. Lynn Winmill.
“This case is an excellent example of local, state and federal law enforcement working together to take out this child sexual predator,” said Davis. “Protecting our children from sexual predators is a top law enforcement priority, and we will continue to use all available tactics and resources to prosecute these individuals.”
“Homeland Security Investigations is committed to bringing to justice to those who sexually exploit children,” said Bradford A. Bench, special agent in charge of HSI Seattle. “This case exemplifies the long reach of HSI, and its ability to coordinate and pursue investigative efforts with our law enforcement partners.”
The case was investigated by Homeland Security Investigations, the Idaho Internet Crimes Against Children Task Force, and the Valley County Sheriff’s Office. The case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Norwich Man Sentenced to Prison for Role in Eastern Connecticut Insurance Fraud SchemeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JONAS JOSEPH, also known as “James,” 34, of Norwich, was sentenced today by U.S. District Judge Jeffrey Alker Meyer in New Haven to eight months of imprisonment, followed by three years of supervised release, for his role in a scheme to stage car accidents for the purpose of defrauding automobile insurance companies.
On June 15, 2017, a jury found JOSEPH guilty of one count of conspiracy to commit mail and wire fraud, and Mackenzy Noze guilty of one count of conspiracy to commit mail and wire fraud, five counts of wire fraud and three counts of mail fraud.
According to the evidence presented during the trial, between March 2011 and February 2014, Noze, JOSEPH and others conspired to stage numerous car crashes in eastern Connecticut for the purpose of defrauding automobile insurance companies and enriching themselves. A high percentage of these planned crashes were single-vehicle accidents on remote roads where there were no witnesses other than the occupants of the crashed vehicle. After each staged accident, the defendants filed fraudulent property damage and bodily injury claims with various automobile insurance companies. They then collected payouts on the fraudulent claims from the victim insurance companies. These payouts typically ranged from approximately $10,000 to $30,000 per accident.
The evidence at trial indicated that Noze participated in as many as 50 staged crashes, and JOSEPH was personally involved in six crashes. In three of the crashes, JOSEPH feigned injury and filed fraudulent bodily injury claims. In the other three, he allowed others to crash into his vehicle so that he could collect payouts on fraudulent property damage claims.
Judge Meyer ordered JOSEPH to pay restitution of $44,153.42.
JOSEPH has been released on a $10,000 bond since his arrest on June 1, 2016. Judge Meyer ordered him to report to prison on November 27.
On October 2, 2017, Judge Meyer sentenced Noze to 48 months in prison.
Five other individuals have been charged and convicted as a result of this investigation.
This matter has been investigated by the Federal Bureau of Investigation, the Norwich Police Department, and the National Insurance Crime Bureau. The case is being prosecuted by Assistant U.S. Attorneys Avi Perry and Michael J. Gustafson.
New York Doctor Convicted of Taking Bribes in Test-Referral Scheme with New Jersey Clinical LabRead the Press Release
NEWARK, N.J. – A doctor practicing in Staten Island, New York, was convicted at trial today for accepting bribes in exchange for test referrals as part of a long-running and elaborate scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president and numerous associates, Acting U.S. Attorney William E. Fitzpatrick announced.
Thomas V. Savino, 58, of Staten Island, was found guilty on all 10 counts of an indictment charging him with one count of conspiring to commit violations of the Anti-Kickback Statute, the Federal Travel Act and wire fraud; three substantive violations of the Anti-Kickback Statute; three substantive violations of the Federal Travel Act; and three substantive violations of wire fraud.
Savino was convicted following a six-day trial before U.S. District Judge Stanley R. Chesler in Newark federal court. The jury deliberated for two and a half hours before returning its verdict.
According to documents filed in this case and the evidence at trial:From July 2012 through April 2013, Savino received cash bribes totaling at least $25,000 from BLS employees and associates in return for referring his patients’ blood specimens to BLS. Savino’s referrals generated approximately $375,000 in lab business for BLS.
The investigation has thus far resulted in 51 convictions – 37 of them doctors– in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. It is believed to be the largest number of medical professionals ever prosecuted in a bribery case.
The investigation has to date recovered more than $13 million through forfeiture. On June 28, 2016, BLS, which is no longer operational, pleaded guilty and was required to forfeit all of its assets.
The Anti-Kickback and Federal Travel Act counts are each punishable by a maximum potential penalty of five years in prison. The wire fraud counts are each punishable by a maximum potential penalty of 20 years in prison. Each count also carries a maximum $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is set for Feb. 14, 2018.
Acting U.S. Attorney William E. Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark; inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Joseph W. Cronin; IRS–Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert with the ongoing investigation.
The government is represented by Senior Litigation Counsel Joseph N. Minish and Assistant U.S. Attorney Erica Liu of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.
The New Jersey U.S. Attorney’s Office reorganized its health care fraud practice in 2010 and created a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since that time, the office has recovered more than $1.37 billion in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.
Defense counsel: Eric R. Breslin Esq., Newark and Melissa S. Geller, New YorkNew Orleans Man Charged with Embezzling over $437,000 from Local EmployerRead the Press Release
Acting U.S. Attorney Duane A. Evans announced that WAYNE SONIAT, age 61, of New Orleans, was charged in a two-count Bill of Information with wire fraud and making false statements on federal income tax returns.
According to the Bill of Information, SONIAT was employed as a warehouse manager for a New Orleans-based food production company headquartered in Metairie, which also operated a manufacturing plant in Reserve (“Company A”). SONIAT was responsible for, among other things, ensuring that employees followed appropriate procedures, keeping track of when temporary employees worked, and submitting the requisite paperwork, including time sheets, to ensure that Company A paid the temporary employees and the staffing agency through whom the temporary employees were acquired for the time the temporary employees worked. Between about November 2009 and October 2014, SONIAT embezzled approximately $437,346 from Company A in a series of approximately 200 wire transfers, without Company A’s knowledge or authorization. SONIAT did so by signing and submitting paperwork, including time sheets, indicating that temporary, contract employees (“ghost employees”) had performed work for Company A when, in fact, they had not. SONIAT obtained debit cards in the names of the ghost employees onto which payments were made for the time they allegedly worked. SONIAT then used the money to pay for personal expenses to withdraw cash at area ATMs.
If convicted, SONIAT faces a maximum term of imprisonment of 23 years in prison, 3 years of supervised release after any term of imprisonment, and a $250,000 fine.
Acting U.S. Attorney Evans reiterated that the Bill of Information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
Acting U.S. Attorney Evans praised the work of the Internal Revenue Service – Criminal Investigations in investigating this matter, with assistance from the United States Secret Service, the St. John the Baptist Sheriff’s Office, and the Louisiana Financial Crime Task Force. The case is being prosecuted by Assistant United States Attorney Jordan Ginsberg.
Mississippi Man Charged with Theft from Government for Defrauding TARP-funded Alabama BankRead the Press Release
BIRMINGHAM – Federal prosecutors this week charged a Mississippi man with stealing government property by defrauding an Alabama bank that received money through the Troubled Asset Relief Program following the 2008 financial crisis, announced U.S. Attorney Jay E. Town, TARP Special Inspector General Christy Goldsmith Romero, and FBI Special Agent in Charge Johnnie Sharp Jr.
The U.S. Attorney’s Office charged THOMAS G. COMER JR., 58, of Columbus, Miss., with one count of theft of government money or property between January 2010 and July 2014. In conjunction with the charge, prosecutors also filed a plea agreement with Comer in which he agrees to plead guilty, pay restitution of $136,278 to the U.S. Treasury and forfeit that same amount to the government as proceeds of illegal activity. Comer must appear before a federal judge to formally enter his guilty plea.
The Treasury Department lost nearly $500,000 in its TARP investment in the Lamar County, Ala., bank that Comer defrauded, according to his plea agreement.
“Those who greedily seek a self-indulgent advantage during times of calamity, especially in times of financial crisis or natural disaster, will be vigorously prosecuted by the United States,” Town said. “I want to thank SIGTARP and the FBI for their outstanding work on this case.”
“Today’s plea is an important step in the fight against fraud that hurt a TARP bank and cost taxpayers,” Romero said. “One week after taxpayers funded Bank of Vernon with $6 million in a TARP program to foster small business lending, the bank loaned money to Thomas Comer to buy river barges. Months later, Comer sold the barges that served as collateral for the loans, and defrauded the bank, keeping the money for himself rather than repaying the loans,” she said. “Fraud against a TARP bank is fraud against taxpayers, as seen here when the bank could not repay TARP in full and Treasury took a loss of nearly half a million dollars. I thank U.S Attorney Jay E. Town and his team for fighting with SIGTARP against TARP bailout-related crime and recovering funds for Treasury.”
“Mr. Comer ultimately stole from tax-paying citizens in order to line his own pockets,” Sharp said. “The FBI and our partners will continue to pursue and bring to justice those who perpetrate this type of fraud.”
Comer owned a Mississippi-based company, CFC Transportation, which specialized in hauling gravel and other freight on the Mississippi and other rivers. He and his company filed for bankruptcy in federal court in May 2014, according to his plea agreement.
Comer had an established banking relationship with the Bank of Vernon in Lamar County and in March 2009 obtained a $295,922 business loan to buy nine barges, according to the plea agreement. The loan documentation designated the barges as security for the loan.
Several months later, Comer obtained a second loan, in the form of a $136,278 line of credit, saying the barges “had been arrested” and he needed money to recover them, according to the plea agreement. In early 2010, Comer sold six of the nine barges for $239,000 but used that money to prop up his struggling businesses rather than to repay his bank loans. Comer also did not inform the Bank of Vernon that he had sold the barges. Between July 27, 2010, and June 25, 2013, on 11 loan renewals and extensions of his two loans, Comer misrepresented his security for the loans, listing the nine barges as collateral, according to his plea agreement.
The Vernon bank, through its holding company, First Vernon Bancshares, received $6 million in TARP funds from the U.S. Treasury in June 2009, according to Comer’s plea agreement. The Treasury Department established TARP as part of the Emergency Economic Stabilization Act of 2008. TARP was designed to restore liquidity and stability to the country’s financial system in the wake of the financial crisis.
In exchange for the TARP funds to First Vernon Bancshares, the government held shares in the bank and the holding company was required to pay quarterly dividends to the U.S. Treasury until the bank redeemed its stock. In September 2010, the bank converted to a different TARP program designed to help small businesses obtain credit, but First Vernon Bancshares still was required to make quarterly dividend payments to the Treasury Department until the bank repaid its investment, according to Comer’s plea agreement.
The holding company ultimately missed some of the quarterly payments and, in November 2016, reached an agreement with Treasury to buy back its preferred stock for about $5.7 million, according to the plea agreement. Treasury lost about $499,600 on its investment in First Vernon Bancshares.
Comer could face a prison sentence of up to 10 years.
Treasury’s Office of the Special Inspector General for the Troubled Asset Relief Program and the FBI investigated the case, which Assistant U.S. Attorney Xavier Carter is investigating.
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Michigan Man Pleads Guilty to Conspiracy to Sexually Exploit Dozens of Minor GirlsRead the Press Release
Grand Rapids, Michigan resident pleaded guilty on Oct. 25, to two child exploitation offenses, including conspiracy to produce child pornography and conspiracy to receive and distribute child pornography, announced Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney Beth Drake of the District of South Carolina.
James Thomas Gersky, 33, pleaded guilty two weeks before he was set to go on trial in Charleston, South Carolina. Six other co-defendants had already pleaded guilty.
According to court documents, between July 2014 and April 2015, Gersky and his co-conspirators utilized a website that was specifically designed to help the group target and sexually exploit underage girls. The website was password-protected and only vetted individuals could become members. The members of the website worked together to identify social media profiles of girls, including girls younger than 13, and strategized how to convince the girls to engage in sexually explicit activity via live web camera. Typically, Gersky and his co-conspirators streamed pre-recorded videos of other underage girls engaging in similar conduct to their target-victims in an effort to trick the girls into believing they were watching a live video of someone their own age. Using peer-pressure, the members convinced the victims to engage in sexually explicit activity. The victims were unaware that they were actually communicating with adult men who were recording the sexually explicit activity. After successfully recording a victim’s sexually explicit activity, Gersky and his co-conspirators would share the videos with each other by uploading the file to a file-storage site and placing a link to download the file on a section of their website. To date, 87 victims from 28 states and Canada have been positively identified.
Five of the co-conspirators each pleaded guilty to one count of conspiracy to produce child pornography and one count of conspiracy to receive and distribute child pornography. On Aug. 8, Jonathan Cripe, 28, of Imperial, Missouri, pleaded guilty. On Sept. 28, Sean Ellis, 43, of Kennesaw, Georgia, and Steven Fox, 39, of Elkridge, Maryland, each pleaded guilty. On Oct. 12, Michael Augustin, 44, of Fort Collins, Colorado, pleaded guilty. On Oct. 20, Dejan Becovic, 24, of West Vallen City, Utah, pleaded guilty. Becovic also previously pleaded guilty in Utah to receipt of child pornography, and on Oct. 18, was sentenced to 15 years in federal prison for the Utah conviction. On Sept. 29, Brandon Gressette, 33, of Summerville, South Carolina pleaded guilty to conspiracy to produce child pornography, as well as two substantive counts of production of child pornography. Additionally, another co-conspirator, Jonathan Soto, 27, of Branchburg, New Jersey, was prosecuted in the District of New Jersey and also pleaded guilty to conspiracy to produce child pornography. On March 31, Soto was sentenced to 18 years in federal prison for his role in the scheme.
The FBI is investigating the case. Trial Attorneys Lauren Britsch and Austin M. Berry of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Dean Secor are prosecuting the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc.
Mescalero Apache Man Pleads Guilty to Assaulting a Federal OfficerRead the Press Release
ALBUQUERQUE – Ronald Roy Blaylock, Sr., 34, an enrolled member of the Mescalero Apache Nation who resides in Mescalero, N.M., pled guilty yesterday afternoon in federal court in Las Cruces, N.M., to assaulting a federal officer.
Blaylock was arrested on June 1, 2017, on a criminal complaint charging him with assaulting a federal officer. According to the criminal complaint, Blaylock was arrested on tribal charges after he assaulted a law enforcement officer of the Bureau of Indian Affairs (BIA). Blaylock committed the assault on the Mescalero Apache Indian Reservation in Otero County, N.M., on Jan. 30, 2016, by head-butting the officer while the officer was arresting Blaylock. The officer sustained a bump and bruise to his head as the result of the assault.
Blaylock was subsequently charged by indictment on Oct. 19, 2017, with assaulting a federal officer on Jan. 30, 2016, in Otero County.
During yesterday’s proceedings, Blaylock pled guilty to the indictment and admitted that on Jan. 30, 2016, he assaulted a BIA officer by intentionally head-butting the officer. At sentencing, Blaylock faces a maximum penalty of eight years in federal prison. A sentencing hearing has yet to be scheduled.
This case was investigated by the Mescalero Agency of the BIA’s Office of Justice Services and is being prosecuted by Assistant U.S. Attorney Aaron O. Jordan of the U.S. Attorney’s Las Cruces Branch Office.
Memphis Man Sentenced to 57 Months in Scheme to Defraud Financial InstitutionsRead the Press Release
Memphis, TN – A Memphis man has been sentenced to 57 months in federal prison for committing bank fraud against financial institutions in the Memphis area. D. Michael Dunavant, U.S. Attorney for the Western District of Tennessee, announced the sentence today.
According to the indictment, from August 2011 through February 2016, Talmadge Garner and other co-conspirators participated in a deceptive scheme to defraud Orion Federal Credit Union, SunTrust Bank and Regions Bank by opening new accounts and/or using their existing accounts to deposit fraudulent checks. Garner also stole the identities of individuals to pass fraudulent checks to the Banks.
Nearly 200 fraudulent checks totaling over $130,000 were deposited into accounts at the Banks. Immediately after deposits were made in the banks, withdrawals were made by Garner and others. Garner would give co-conspirators some of the proceeds withdrawn from the banks.
On October 25, 2017, U.S. District Judge Sheryl H. Lipman sentenced Garner to 57 months imprisonment and 3 years supervised release to begin after his incarceration.
The case was investigated by the United States Secret Service. Assistant U.S. Attorney Damon Keith Griffin prosecuted the case on the government’s behalf.
Memphis Man Sentenced to 18 Months in Federal Prison for Obstructing the IRSRead the Press Release
Memphis, TN – A Memphis man has been sentenced to 18 months in federal prison for obstructing the Internal Revenue Service ("IRS"). D. Michael Dunavant, U.S. Attorney for the Western District of Tennessee announced the sentence today.
According to documents and information provided to the court, Cedric Zimbalist Chism was the former owner and operator of a security guard service, Memphis Security of Tennessee, Inc. ("MSOFT"). MSOFT had contracts for services with various businesses throughout the Western District of Tennessee in Memphis. Chism attempted to impede and evade payment and reporting of employment taxes to the IRS from 1999 to 2011. Chism, personally and as owner and operator of MSOFT, owed $1,688,473.45 with a tax loss to the IRS of $854,144.39.
On October 20, 2017, U.S. District Judge John T. Fowlkes, Jr., sentenced Chism to 18 months imprisonment and 1 year supervised release to begin after his incarceration.
The case was investigated by the United States Internal Revenue Service. Assistant U.S. Attorney Damon Keith Griffin prosecuted this case on the government’s behalf.
Man Convicted of Arson for Throwing Molotov Cocktails at ApartmentsRead the Press Release
ALEXANDRIA, Va. – A federal judge convicted an Alexandria man today on charges of arson after throwing Molotov cocktails and setting fire to an apartment building in Alexandria.
According to court records and evidence presented at the bench trial, Josepha Kasai, 23, smashed a Molotov cocktail at the door of a third floor apartment unit, setting fire to the doorway and trapping nine individuals on the third floor. Kasai then went outside and threw another Molotov cocktail at the third floor apartment unit, breaking through the bedroom window. The entire building was evacuated due to the fire. A victim inside the third floor apartment jumped from his balcony and Kasai chased the victim with what appeared to be a knife. After Kasai’s arrest, he informed law enforcement he intended to kill the victim who jumped from the balcony and claimed the victim had previously stolen his iPhone.
Kasai was convicted of arson and possession of an unregistered destructive device and faces a mandatory minimum of five years and a maximum of 30 years in prison when sentenced on Feb. 9, 2018. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia, Arron J. Graves, Acting Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, Robert C. Dubé, Chief of Alexandria Fire Department, and Michael L. Brown, Chief of Alexandria Police Department, made the announcement after U.S. District Judge Anthony J. Trenga rendered the verdict. Assistant U.S. Attorneys Maureen C. Cain and Nicholas U. Murphy II are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-268.
Lower Brule and Fort Thompson Residents Indicted on Methamphetamine ChargesRead the Press Release
United States Attorney Randolph J. Seiler announced that Lower Brule and Fort Thompson, South Dakota, individuals have been indicted by a federal grand jury for Conspiracy to Distribute a Controlled Substance and Possession with Intent to Distribute a Controlled Substance.
Ashley Ellen Ross, Fort Thompson, age 30, Samantha Jane Dolezal, Fort Thompson, age 25, and Sara Renee Pray, Lower Brule, age 26, were indicted on June 14, 2017. Ross and Dolezal appeared before U.S. Magistrate Judge Mark A. Moreno on June 19, 2017. Pray appeared before U.S. Magistrate Judge Mark A. Moreno on October 18, 2017. All three pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 20 years in custody and/or a $1,000,000 fine, a lifetime of supervised release, and $100 to the Federal Crime Victims Fund for each Count. Restitution may also be ordered. Pray also stands to forfeit over $1,292 in United States currency and gift cards, which were seized by law enforcement.
The Indictment alleges that between January 1, 2015, and June 14, 2017, Ross, Dolezal, and Pray knowingly and intentionally conspired with others to distribute and possess with the intent to distribute methamphetamine, a Schedule II controlled substance, in South Dakota. The Indictment further alleges that on November 14, 2016, Pray possessed methamphetamine with the intent to distribute it.
The charges are merely accusations and Ross, Dolezal, and Pray are presumed innocent until and unless proven guilty.
This case was investigated by the Northern Plains Safe Trails Drug Enforcement Task Force, Rosebud Sioux Tribe Law Enforcement Services, Bureau of Indian Affairs Crow Creek Agency, and Sioux Falls Police Department. Assistant U.S. Attorney SaraBeth Donovan is prosecuting the case.
Ross, Dolezal, and Pray were remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Local, State, Tribal & Federal Agencies Offering Safe Disposal of Unwanted Prescription DrugsRead the Press Release
MUSKOGEE, OKLAHOMA – On Saturday, October 28, from 10 a.m. to 2 p.m. three area law enforcement agencies will be partnering with the Drug Enforcement Administration to give the public its 14th opportunity in 7 years to prevent pill abuse and theft by ridding their homes of potentially dangerous expired, unused, and unwanted prescription drugs. Pills or patches can be brought to disposal sites in Tahlequah and Talihina. (The DEA cannot accept liquids or needles or sharps, only pills or patches.) The service is free and anonymous, no questions asked.
The local agencies and disposal locations set up specifically for October 28th in the Eastern District of Oklahoma are:
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Cherokee Nation Marshal Service, 22114 S Bald Hill Rd, Tahlequah
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Northeastern State University Police, 612 N. Grand Avenue, Tahlequah
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Choctaw Nation Tribal Police, One Choctaw Way, Talihina
Last April Americans turned in 450 tons (900,000 pounds) of prescription drugs at almost 5,500 sites operated by the DEA and more than 4,200 of its state and local law enforcement partners. Overall, in its 13 previous Take Back events, DEA and its partners have taken in over 8.1 million pounds—more than 4,050 tons—of pills.
The Oklahoma Bureau of Narcotics (OBN), also a partner in the effort to reduce prescription drug abuse by offering safe disposal options, offers locations throughout the state. OBN’s website, found at www.ok.gov/obndd can assist you in finding a location near you.
Brian J. Kuester, U.S. Attorney for the Eastern District of Oklahoma said, “This service, offered by the DEA, OBN and local agencies is a valuable component of the joint efforts by state, local, tribal and federal agencies to reduce the abuse of prescription drugs. I urge everyone who has unneeded prescription medications to dispose of them, and applaud the efforts of these agencies to give a safe no-questions asked location for disposal.”
Medicines that languish in home cabinets are highly susceptible to diversion, misuse, and abuse. Rates of prescription drug abuse in the U.S. are alarmingly high, as are the number of accidental poisonings and overdoses due to these drugs. Studies show that a majority of abused prescription drugs are obtained from family and friends, including from the home medicine cabinet. In addition, Americans are now advised that their usual methods for disposing of unused medicines—flushing them down the toilet or throwing them in the trash—both pose potential safety and health hazards.
For more information about the disposal of prescription drugs or about the October 28 Take Back Day event, go to the DEA Diversion website at www.deadiversion.usdoj.gov/drug_disposal/takeback/.
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Livingston Felon and Pharmacy Burglar SentencedRead the Press Release
BILLINGS - The United States Attorney’s Office announced today that Bradlee Scott Ledford was sentenced to 36 months in prison, three years of supervised release, and a $100 special assessment. U.S. District Judge Susan Watters presided over the hearing.
On January 2, 2016, Livingston Police Department responded to an alarm at The Plaza strip in Livingston. Ledford burglarized the Matt Long Photography Studio and Western Drug Store and Pharmacy. He stole two handguns and $475.00 from the photo studio and approximately 470 various prescription pills from the pharmacy. Ledford started in the photo studio, and then used one of the stolen handguns to smash the glass at Western Drug. Both handguns taken from the studio were retrieved - one in the trash near the building and one in the backyard of someone who lived nearby.
The Western Drug burglary was recorded on surveillance video, and from that video, police officers recognized Ledford in the act. The pharmacy supplied a list of the drugs and the amounts that were stolen. The replacement cost for the stolen prescription drugs is approximately $1400. There was also damage to the doors to enter the pharmacy and the store. Ledford was previously convicted in 2015 of felony theft in Yellowstone County.
Because there is no parole in the federal system, the truth in sentencing guidelines mandate that Ledford will likely serve all of the time imposed by the court. In the federal system, Ledford does have the opportunity to shorten the term of custody by earning credit for good behavior. However, this reduction will not exceed 15% of the overall sentence.
The case was prosecuted by Assistant U.S. Attorney Paulette Stewart and investigated by the Livingston Police Department, and the Drug Enforcement Administration.
The U.S. Attorney’s Office is partnering with federal, state, local and tribal law enforcement to identify those responsible for significant violent crime in Montana. A centerpiece of this effort is Project Safe Neighborhoods, a recently reinvigorated Department of Justice program that has proven to be successful in reducing violent crime. Today’s sentencing is part of the Project Safe Neighborhoods program.
Leominster Man Sentenced for Dealing Heroin and CocaineRead the Press Release
BOSTON – A Leominster man was sentenced today in federal court in Worcester for his role in a drug trafficking conspiracy.
Felix Melendez, 41, was sentenced by U.S. District Court Judge Timothy S. Hillman to 70 months in prison and four years of supervised release. In May 2017, Melendez and four co-defendants pleaded guilty to conspiracy to distribute heroin and cocaine in Worcester County.
In the late summer of 2014, federal agents began investigating the narcotics trafficking activities of Osvaldo Vasquez and his associates, Melendez, Jose Federico Vasquez, Elvis Genao, and Hugo Santana-Dones. Between November 2014 and July 2015, with the help of a cooperating witness, agents made numerous recorded purchases of heroin - sometimes laced with fentanyl - from members of the conspiracy, seizing over 400 grams of heroin as a result. Search warrants executed at the various defendants’ residences led to the seizure of over a kilogram of heroin and cocaine along with a loaded firearm.
During the controlled purchases, Melendez was recorded distributing well over 100 grams of heroin to a government cooperator in July 2015. Intercepted wiretaps between April and July 2015 also captured Melendez discussing the delivery and sale of over two kilograms of narcotics.
Santana-Dones was sentenced on Sept. 6, 2017, to 80 months in prison and will be subject to deportation hearings upon completion of his sentence; Federico Vasquez was sentenced on Sept. 18, 2017, to five years in prison and will be subject to deportation hearings upon completion of his sentence; Genao was sentenced on Sept. 19, 2017, to 37 months in prison; and Osvaldo Vasquez is scheduled to be sentenced on Nov. 3, 2017.
Acting United States Attorney William D. Weinreb; Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division; Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police; Worcester Police Chief Steven M. Sargent; Fitchburg Police Chief Ernest F. Martineau; and Leominster Interim Police Chief Michael Goldman made the announcement today. Assistant U.S. Attorney Mark J. Grady of Weinreb’s Worcester Branch Office is prosecuting the cases.
Lawrence Woman Pleads Guilty Participating in a Conspiracy to Distribute FentanylRead the Press Release
CONCORD, N.H. – Acting United States Attorney John J. Farley announced that Carmen Jose, 40, of Lawrence Massachusetts, pleaded guilty in federal court on Tuesday to one count of conspiracy to distribute, and possess with intent to distribute, fentanyl.
According to court documents and statements made in court, during the summer of 2015, Jose and a co-conspirator sold fentanyl to an undercover police officer on multiple occasions. The defendant was arrested on September 8, 2016, when she and her co-conspirator arrived at the Rockingham Mall in Salem, New Hampshire in order to sell approximately 500 grams of fentanyl. After her arrest, law enforcement officers recovered approximately 512 grams of fentanyl from the vehicle Jose had been operating.
A sentencing hearing has been scheduled for January 30, 2018. Her alleged co-conspirator, Robert R. Arias, is scheduled to go to trial on January 23, 2018.
“The U.S. Attorney’s Office continues to work with our law enforcement partners to stop the flow of fentanyl and other deadly drugs into the Granite State,” said Acting U.S. Attorney Farley. “While those who suffer from addiction should be able to gain access to treatment, those who seek to profit from selling drugs will be prosecuted. We continue to work each day with our law enforcement partners to identify and prosecute those who are distributing these deadly substances.”
The case was investigated by the Drug Enforcement Administration and is being prosecuted by Assistant United States Attorney Georgiana L. Konesky.
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Lawrence Man Pleads Guilty to Cocaine ConspiracyRead the Press Release
BOSTON – A Lawrence man pleaded guilty today in federal court in Boston to his role in a cocaine conspiracy.
Juan Ulfany Mateo Soto, 38, pleaded guilty to one count of conspiracy to possess with intent to distribute cocaine and one count of conspiracy to attempt to possess with intent to distribute cocaine. In December 2016, Mateo Soto was arrested and charged along with five co-defendants. U.S. District Court Judge Richard G. Stearns scheduled sentencing for Jan. 31, 2018.
On Oct. 27, 2016, Mateo Soto arranged to obtain six kilograms of cocaine from another defendant. Officers observed the transaction, and subsequently stopped Mateo Soto as he drove away. Mateo Soto did not have a valid driver’s license, so officers towed the vehicle. After the vehicle was towed, Mateo Soto and other defendants attempted to retrieve the drugs from the car, first as it was being towed, and later at the tow yard.
Mateo Soto is the third defendant to plead guilty. Angel Torres Leon pleaded guilty in June and is scheduled to be sentenced on Nov. 9, 2017. Angel Figueras pleaded guilty in July 2017 and is scheduled to be sentenced on Nov. 8, 2017.
Each of the conspiracy and attempt charges provides for a sentence of no greater than 20 years in prison, a minimum of three years and a maximum of lifetime of supervised release and a fine of up to $1 million . Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney William Weinreb; Michael Ferguson, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; and Matthew J. Etre, Special Agent in Charge of Homeland Security Investigations in Boston, made the announcement today. Assistant U.S. Attorney Susan Winkler of Weinreb’s Narcotics and Money Laundering Unit is prosecuting the case.
The details contained in the charging documents are allegations. The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Laconia Man Pleads Guilty to Methamphetamine TraffickingRead the Press Release
CONCORD, N.H. - Acting United States Attorney John J. Farley announced today that Robert J. Golden, Jr., 37, of Laconia, pleaded guilty to participating in a conspiracy to distribute methamphetamine.
According to court documents and statements made during today’s plea hearing, on November 3, 2016, U.S. Postal Inspectors intercepted a mail parcel intended for delivery to Golden. A state police canine unit altered to the package. When investigators later opened the package pursuant to a federal search warrant, they found approximately 56 grams of methamphetamine. Investigators removed most of the drugs, re-wrapped the parcel and notified Golden that the package was available for him to pick up at the post office. Postal Inspectors arrested Golden at the post office immediately after he took possession of the parcel. Following his arrest, Golden admitted that he knew that the package contained a quantity of methamphetamine that had been sent from California and that he intended to distribute the methamphetamine in New Hampshire. Golden further acknowledged that he previously had received four to six similar packages from California.
Golden will be sentenced on January 31, 2018.
“Even as our state faces the serious challenge of the opioid crisis, methamphetamine also continues to pose a threat to our community,” said Acting U.S. Attorney Farley. “Using this dangerous drug can cause significant harm or death. I commend the law enforcement officers in this case for their quick actions that prevented this substantial quantity of methamphetamine from being distributed in New Hampshire.”
This matter was investigated by the United States Postal Inspection Service, with help from the New Hampshire State Police and the Laconia (N.H.) Police Department. The case is being prosecuted by Assistant U.S. Attorney Bill Morse.
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Kinloch Official Sentenced for Stealing Money from the Kinloch Fire Protection DistrictRead the Press Release
St. Louis, MO – Darren Small was sentenced to 8 months in prison in connection with his theft of funds from the Kinloch Fire Protection District.
According to court documents, Darren Small, who was Chief of the Kinloch Fire Department and Mayor of the City of Kinloch, conspired with his wife and co-defendant, Jayna Small, to divert funds from the District’s bank account for their own personal use, including to purchase clothing, food, liquor, cigarettes, and to pay their personal household utility bills. Jayna Small was the President of the Board of Directors for the District.
Darren Small, 51, Kinloch, pled guilty in August to one felony count of conspiracy to commit access device fraud and one count of access device fraud. He appeared today for sentencing before United States District Judge Catherine Perry. Last week, Jayna Small was sentenced to 5 years’ probation for her role in the theft.
This case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney Reginald Harris is handling the case for the U.S. Attorney’s Office.
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Kenner Woman Sentenced to Three Years in Prison for Bank LarcenyRead the Press Release
Acting U.S. Attorney Duane A. Evans announced that MARIA SPEARS, a/k/a MARIA BAQUEDANO, 52, of Kenner, was sentenced today after previously pleading guilty to defrauding Gulf Coast Bank and Trust in connection with writing fraudulent checks.
U.S. District Judge Kurt D. Engelhardt sentenced SPEARS to 36 months imprisonment, followed by 3 years of supervised release. A hearing to determine the restitution amount is scheduled for December 20, 2017.
SPEARS pled guilty to a one-count Bill of Information charging her with Bank Larceny. According to court documents, SPEARS opened a checking account at Gulf Coast Bank and Trust, in the Eastern District of Louisiana. This account was closed in 2011 and contained no funds at the times Spears issued the checks. The deposits of Gulf Coast Bank and Trust were insured by the Federal Deposit Insurance Corporation. (“FDIC”) when Spears wrote the fraudulent checks.
From on or about June 6, 2015 until on or about March 26 2016, SPEARS wrote approximately $357,000 of bad checks. Each time a check was presented, the bank declined to release the funds as the account had been closed since 2011.
On June 26, 2015, SPEARS issued a check in Jefferson Parish in the amount of $5,000 to Party “A”, in order to purchase real estate in Kenner.
On December 12, 2015, SPEARS purchased a 2016 Chevrolet Corvette in Jefferson Parish from Dealer “A” with a check for $80,390.29 from the closed account.
On March 5, 2016, SPEARS purchased a 2016 Nissan GTR in Jefferson Parish from Dealer “B” with a check for $130,675 from the closed account.
On March 21, 2016, SPEARS purchased a 2016 Cadillac Escalade Premium in Jefferson Parish from Dealer “C” with a check for $97,590.75 from the closed account.
On March 26, 2016 in Tangipahoa Parish, SPEARS purchased a 2016 Nissan 370Z from Dealer “D” with a check for $44,000 from the closed account.
SPEARS was on supervised release for another federal offense when she committed this crime. On December 6, 2012, SPEARS was sentenced to serve 21 months imprisonment for wire fraud in the Middle District of Louisiana. She was ordered to pay $176,267.96 in restitution and was placed on three years supervised release.
Acting U.S. Attorney Evans praised the work of the U.S. Probation Service in investigating this matter. Assistant United States Attorney Carter K. D. Guice, Jr. of the Fraud Unit is in charge of the prosecution.
Kenner Man Indicted for Arson and Possessing a Destructive DeviceRead the Press Release
Acting United States Attorney Duane A. Evans announced that RYAN SCOTT, age 39, of Kenner, was charged with federal firearms violations in a recently unsealed two-count Indictment.
According to the Indictment, SCOTT committed arson of a building in LaPlace, on August 13, 2017, in violation of Title 18, United States Code, Section 844(i). SCOTT also possessed a destructive device in violation of Title 26, United States Code, Section 5861(d) on the same date.
If convicted, SCOTT faces, as to count one, a minimum of 5 years and a maximum of 20 years of imprisonment, 3 years supervised release after imprisonment, a fine of $250,000, and a $100 special assessment. As to count two, SCOTT faces a maximum term of imprisonment of 10 years, a fine of $10,000, three years supervised release after imprisonment, and a $100 special assessment.
Acting U.S. Attorney Evans reiterated that an Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
Acting U.S. Attorney Evans praised the work of the Bureau of Alcohol, Tobacco, Firearms, and Explosives in investigating this matter. Assistant United States Attorney Maria M. Carboni is in charge of the prosecution.
Katie Stygles Pleads Not Guilty to Defrauding Bradford EmployerRead the Press Release
The United States Attorney for the District of Vermont announced that Katie Stygles, 29, of Piermont, New Hampshire, pleaded not guilty today in United States District Court in Burlington to federal fraud charges. U.S. Magistrate Judge John M. Conroy released Stygles on conditions pending trial, which has not been scheduled.
On September 28, 2017, a federal grand jury in Burlington returned a two-count indictment charging Stygles with wire fraud and access device fraud. According to the indictment, Stygles began working for ARC Mechanical Contractors in Bradford, Vermont in 2010. In February 2016, she was promoted to the position of office manager. In that job, Stygles had access to the company credit card number, which she used to order supplies.
According to the indictment, beginning in August 2016 and continuing through early May 2017 when she was fired, Stygles used the ARC Mechanical credit card about 130 times to purchase tack, barn supplies and equine, canine and livestock products for KMS Stables, a business that Stygles owned. She ordered the products from a vendor in Ohio using ARC Mechanical’s telephones and computers. During this time period, Stygles also diverted customer payments that were intended for ARC Mechanical into a Pay-Pal account for KMS Stables, and used ARC Mechanical’s United Parcel Service account to pay for goods she was shipping to customers of KMS Stables.
The indictment charges that the total fraud amounted to more than $73,000.
The United States Attorney emphasizes that the charges in the indictment are merely accusations and that the defendant is presumed innocent unless and until she is proven guilty.
If convicted, Stygles faces up to 20 years of imprisonment and a fine of up to $250,000. The actual sentence would be determined with reference to federal sentencing guidelines.
This case was investigated by the Bradford Police Department and the United States Secret Service.
Stygles is represented by Assistant Federal Defender Steven Barth. The prosecutor is Assistant U.S. Attorney Gregory Waples.
KC Man Pleads Guilty to Illegally Possessing Firearm Tied to Triple Homicide in MississippiRead the Press Release
KANSAS CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced that a Grandview, Mo., man pleaded guilty in federal court today to illegally possessing firearms, including a stolen firearm connected to a triple homicide and a series of business burglaries in Mississippi.
Reno R. Dillard, 39, of Grandview, pleaded guilty before U.S. District judge Beth Phillips to one count of being a felon in possession of a firearm and one count of possessing a firearm in furtherance of a drug-trafficking crime.
By pleading guilty today, Dillard admitted that he was in possession of several firearms on Jan. 23, 2017. According to court documents, a confidential source told investigators that Dillard had purchased approximately 20 firearms that were stolen during the burglary of a Gulfport, Miss., pawn shop.
On Nov. 10, 2016, a burglary was reported at Jay Jays Pawn & Jewelry in Gulfport, where 29 firearms were reported stolen. After this burglary, between Dec. 13 and Dec. 16, 2016, JB’s Pawn in Gulfport and Sam’s Jewelry in Pascagoula, Miss., were broken into as well. On Dec. 17, 2016, a violent robbery occurred at Bill’s Pawn in Jackson, Miss., where three elderly men were found murdered. Investigators identified two primary suspects with ties to the Kansas City, Mo., metropolitan area. On Dec. 21, 2016, the two primary suspects were apprehended in Junction City, Kan.
When investigators executed a search warrant at Dillard’s residence on Jan. 23, 2017, they found a loaded Taurus .380-caliber pistol and a loaded Taurus 9mm pistol under a mattress in the master bedroom. They also found a loaded Colt .45-caliber pistol with an extended drum magazine (stolen from Jay Jays Pawn & Jewelry) and a Mossberg 12-gauge shotgun in a basement safe, a bullet-proof vest in the master bedroom closet, and additional ammunition. Investigators found 24 individually wrapped bags that contained a total of approximately 451 grams of marijuana and a glass jar that contained approximately 40 grams of marijuana. Also found in the safe was $2,030, two digital scales, a seed grinder and plastic baggies that are all used to package marijuana for sale.
Under federal law, it is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. Dillard has two prior felony convictions for being a DWI persistent offender, and prior felony convictions for distributing a controlled substance and unlawful use of a loaded firearm by an intoxicated person.
Under federal statutes, Dillard is subject to a sentence of up to 10 years in federal prison without parole for being a felon in possession of a firearm, plus a mandatory minimum sentence of five years in federal prison without parole, which must be served consecutively, up to a sentence of life in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Emily A. Morgan. It was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, with assistance from the Kansas City, Mo., Police Department and the Grandview, Mo., Police Department.
Jury Convicts Raymondville Man of Meth DistributionRead the Press Release
BROWNSVILLE, Texas – A 20-year-old Raymondville man has been convicted of conspiracy to import and conspiracy to possess with intent to distribute methamphetamine, announced Acting U.S. Attorney Abe Martinez. The federal jury sitting in Brownsville returned its verdicts against Zack Anthony Sayas late yesterday following two days of trial and less than two hours of deliberation.
During trial, the jury heard that Sayas had recruited and conspired with Jose Angel Reyes Jr., 23, also of Raymondville, to travel from Raymondville to Mexico with the intention of smuggling the methamphetamine and transporting it to Houston.
On Dec. 8, 2015, at approximately 6:15 a.m., Reyes attempted to enter the United States via the Veterans Port of Entry as the driver and single occupant of a silver Chevy Aveo. The car was randomly selected for secondary inspection, at which time officers discovered bundles wrapped in tape hidden in each door panel. The substance in the bundles tested positive for crystal methamphetamine and weighed approximately 11.94 kilograms. He was taken into custody at that time.
While detained, agents observed his cell phone receiving continuous messages from the same number. They were also able to obtain an extraction report that included previously deleted text messages from the same sender.
Reyes identified the individual that recruited him to go to Mexico as Sayas. Reyes was to travel to Brownsville where Sayas would take possession of his car and travel to Mexico where the vehicle would be loaded with drugs. Then both Reyes and Sayas would drive the car back to Houston to deliver the drugs. However, there was a slight change of plans and Reyes agreed to drive the car through the port of entry by himself and pick up Sayas on the U.S. side of the border. However, Reyes was intercepted at the Veteran’s Port of Entry.
Evidence showed that the phone number associated to Sayas was the same as the one that sent messages and voicemail to Reyes. The jury also heard that Sayas had driven the Chevy Aveo into Mexico through the Gateway Port of Entry on Dec. 7, 2015, at and re-entered the U.S. via the pedestrian lane the following day.
Sayas attempted to convince the jury that he was working the case as a confidential informant. However, the jury heard rebuttal testimony to the contrary, did not believe his claims and convicted him on all counts as charged.
U.S. District Judge Rolando Olvera presided over trial and has set sentencing for Jan. 31, 2018. At the time, Sayas faces a mandatory minimum of 10 years and up to life in federal prison as well as a possible $10 million maximum fine. He will remain in custody pending that hearing.
Reyes previously pleaded guilty to possession with intent to distribute methamphetamine and is set for sentencing Oct. 30, 2017.
Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation. Assistant U.S. Attorneys David Coronado and Ana Cano are prosecuting the case.
Jury Convicts Florida Man of Arson-for-Profit SchemeRead the Press Release
RICHMOND, Va. – A federal jury convicted a Florida man today of running a 15-year insurance fraud scheme that involved at least 27 fires in two states.
Verdon Taylor, 72, of Leesburg, was found guilty of conspiracy, wire fraud, use of fire to commit a federal felony, and witness tampering in connection with the fraud. Taylor and four co-conspirators, Vershawn Jackson, 39, and Marie Taylor, 54, both of Richmond, along with Sylvia Mitchell, aka Sylvia Jackson, 59, of Tampa, Florida, and Eugenia Fleming, 57, of Victoria, were indicted on March 8. According to court records and evidence presented at trial, Verdon Taylor and his co-conspirators participated in a long-running arson-for-profit scheme in which the conspirators purchased cars or mobile homes at auction, or signed leases at rental properties, insured the property, and set fire to the insured property to collect insurance proceeds. In many instances, the time between the purchase of insurance and the fire was mere weeks or even days. The evidence at trial also showed that the defendants made a practice of staging mobile homes and rental properties with furniture and clothing that had been purchased at flea markets or auctions, and on several occasions had been in other properties that previously burned. Over the course of the scheme, defrauded insurance companies paid out over $1 million on claims by the conspirators.
Verdon Taylor faces a maximum penalty of 50 years in prison when sentenced on Jan. 2, 2018. The co-defendants have entered guilty pleas to conspiracy to commit wire fraud, and each faces a maximum of 20 years in prison. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendants will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia, Arron J. Graves, Acting Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, Henry Rosenbaum, Henrico County Fire Marshal, and Melvin D. Carter, Chief of the Richmond Fire Department, made the announcement after the verdict was accepted by U.S. District Judge Robert E. Payne. Assistant U.S. Attorneys David V. Harbach, II, Michael C. Moore, and Janet Jin Ah Lee are prosecuting the case.
This case was investigated by the ATF with assistance from the Henrico County Fire Department and the Richmond Fire Department.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:17-cr-29.
Indictment: Kansas City Man Robbed Overland Park BankRead the Press Release
KANSAS CITY, KAN. – A Kansas City man was indicted Wednesday on federal charges of robbing a bank in Overland Park, U.S. Attorney Tom Beall said.
Ryan Michael Cothern, 41, Kansas City, Mo., is charged with an Oct. 3, 2107, robbery at US Bank at 9900 West 87th Street in Overland Park. It is alleged Cothern handed a clerk his cell phone on which he had written a memo saying, “Put the 50s and the 100s in the bag. Do not put the dye pack in the bag. You follow these instructions and no one gets hurt and we can all go home.” Cothern was arrested shortly after the robbery when an Overland Park police officer stopped him in the 8300 block of Melrose Street.
If convicted, Cothern faces up to 20 years in federal prison and a fine up to $250,000. The Overland Park Police Department and the FBI investigated. Assistant U.S. Attorney Sheri Catania is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Four Plead Guilty to Trafficking Heroin, Crack and OxycodoneRead the Press Release
Bangor, Maine: United States Attorney Halsey B. Frank announced that Yanel Greene, a/k/a “Nel”, 37, of Brewer, Maine; and Syriane Baldwin, a/k/a “Del”, 31, and Quindell Smallwood, a/k/a “Queezo”, 37, both of Bangor; pleaded guilty today in U.S. District Court to conspiring to distribute and distributing heroin, cocaine base, commonly known as crack, and oxycodone. Alialin Doughty, a/k/a “Ally”, 38, of Old Town, Maine, pleaded guilty to maintaining drug-involved premises. All were charged by indictment on January 19, 2017.
According to court records, between January 2013 and September 2015, the group conspired with others to distribute heroin, crack and oxycodone in the Bangor area and elsewhere. Greene obtained the drugs from out-of-state sources and had them transported to Maine by other conspirators. Baldwin, Smallwood, Grant and other conspirators distributed the drugs to customers in the Bangor area. Doughty rented an apartment in Bangor that was used to facilitate drug trafficking.
Greene, Baldwin and Smallwood face up to 20 years in prison, a $1,000,000 fine and from three years to life on supervised release. Doughty faces up to 20 years in prison, a $500,000 fine and from three years to life on supervised release.
The case was related to the heroin conspiracy prosecution of Mario Lee, a/k/a “Moe,” who, on May 5, 2017, was sentenced to over 18 years in prison. On June 29, 2017, Duval Grant, a/k/a “Val”, 25, formerly of the Bronx, New York, pleaded guilty to the conspiracy charge and awaits sentencing.
The case was investigated by the Maine Drug Enforcement Agency and the U.S. Drug Enforcement Administration. This case was investigated and prosecuted as part of the Department of Justice’s Strategy to Combat the Opioid Epidemic.
Founder and Former Administrator of Group of Public Charter Schools in Albuquerque Pleads Guilty to Federal Theft, Fraud and False Statements ChargesRead the Press Release
ALBUQUERQUE – Acting U.S. Attorney James D. Tierney and Special Agent in Charge Terry Wade of the Albuquerque Division of the FBI announced today that David Scott Glasrud, the former administrator of Southwest Learning Centers in Albuquerque, N.M., has pleaded guilty to federal theft, fraud and false statement charges arising out of a 15-year scheme to defraud millions of dollars from the group of public charter schools he founded.
During this morning’s proceedings, Glasrud, 50, entered a guilty plea to a nine-count felony information charging him with two counts of theft from programs receiving federal funds, three counts of wire fraud, two counts of mail fraud, and two counts of making false statements. Glasrud entered the guilty plea under an agreement that recommends a term of imprisonment within the range of 48 to 63 months. Glasrud also will be required to pay restitution in an amount to be determined by the court.
According to the felony information, Glasrud established the public charter school Southwest Secondary Learning Center in Albuquerque in Dec. 1999, and later established three other public charter schools in Albuquerque: Southwest Primary Learning Center, Southwest Intermediate Learning Center, and Southwest Aeronautics, Mathematics & Science Academy. The four schools collectively are known as the Southwest Learning Center Schools (Charter Schools) and operate with public funds, including federal funds.
Glasrud served as the Head Administrator for, and exercised financial oversight over, the Charter Schools until Aug. 2014. As the Head Administrator and an employee of the Charter Schools, Glasrud had a duty to use his best efforts on behalf of the Charter Schools in all matters of trust and confidence, and not to act for his own benefit at the expense of the Charter Schools. In his plea agreement, Glasrud admitted violating this duty of trust repeatedly over the course of 15 years by engaging in an ongoing series of schemes to defraud the Charter Schools for his personal benefit. Glasrud also acknowledged making false statements to FBI Special Agents who were investigating his criminal conduct.
The felony information alleges, and Glasrud has admitted, that from Nov. 2000, Glasrud was doing business in his personal capacity as Southwest Educational Consultants, which he incorporated as Southwest Educational Consultants, Inc. (SEC) in March 2002. Glasrud served as SEC’s registered agent, director and President, and his personal expenses were paid out of an SEC bank account. Glasrud used SEC to facilitate his schemes to defraud the Charter Schools.
For example, from Nov. 2000 through Aug. 2014, Glasrud devised and executed a scheme to defraud that involved leasing a building at 9904 Montgomery Blvd. NE (Building) in Albuquerque to one of the Charter Schools (Charter School 1) by misrepresenting, concealing and omitting material facts from Charter School 1, and by breaching duties that he owed to Charter School 1. In Nov. 2000, while doing business as SEC, Glasrud leased the entire Building. Days later, on Dec. 1, 2000, still acting as SEC, he subleased the Building to Charter School 1 twice the rent that SEC was paying and without disclosing this material information to Charter School 1. As part of his scheme, by 2007, Glasrud had arranged for SEC to sublease a majority of the square footage of the Building to a tenant, with whom Glasrud had a close familial relationship.
Glasrud admitted that as part of his fraudulent scheme, Charter School 1 paid more than double the rent that SEC paid to lease the entire Building, but occupied less than half the Building. Glasrud also admitted causing Charter School 1 to pay SEC approximately four to five times as much as the other tenant for use of less than half of the Building it was sharing. When the New Mexico Public Education Department (PED) raised concerns about Charter School 1’s sublease, Glasrud caused a school representative to misrepresent to PED and the school board the amount of profit that SEC was realizing off the sublease. In his plea agreement, Glasrud admitted that SEC, his personally owned business, made more than $700,000 in profits as the result of this scheme.
During today’s proceedings, Glasrud also acknowledged devising and executing a series of other schemes to defraud the Charter Schools. In pleading guilty to one of the three wire fraud charges, Glasrud admitted that in Feb. 2004, he and SEC created a bogus business called Media Learning Solutions (MLS) with an “office” address at a mail drop in Las Vegas, NV. Thereafter, Glasrud caused the Charter Schools to pay capital outlay money to MLS based on fraudulent proposals and invoices. Most of the money MLS received from the Charter Schools was not spent on the items for which it was intended or for the benefit of the Charter Schools, and instead was used for Glasrud’s personal benefit. For example, in 2009 and 2010, the Charter Schools paid MLS approximately $265,000, which Glasrud expended as follows: $199,000 to pay down his personal line of credit; $50,000 transferred into his personal bank account; $12,000 for personal items; and $4,000 spent at a casino in Las Vegas, NV.
Another of Glasrud’s fraudulent schemes began in Dec. 2002 and continued until Aug. 2014, and involved Charter School 1’s Extended Learning Program (ELP). The ELP offered students the opportunity to earn school credits using online, computer-based courses. Students paid to receive official school credit from Charter School 1, and Glasrud diverted almost all of the payments into an SEC bank account he controlled. Glasrud admitted that from 2007 to 2014, more than $1,000,000 in payments for the ELP that should have gone to Charter School 1 was deposited into a bank account for SEC, Glasrud’s personal business.
These three schemes are examples of the fraudulent schemes that Glasrud perpetuated over the 15-year period during which he served as the Head Administrator of the Charter Schools and by which he betrayed the trust and confidence placed in him. Glasrud admitted devising and executing each of these three schemes as well as the other schemes described in the felony information and the plea agreement when he entered his guilty plea this morning.
Glasrud was released pending sentencing under pretrial supervision and other conditions of release. A sentencing date has not yet been scheduled.
The case was investigated by the Albuquerque Division of the FBI with the assistance of the U.S. Department of Education, Office of Inspector General. Assistant U.S. Attorneys Fred J. Federici and Holland S. Kastrin are prosecuting the case.
Glasrud Information Glasrud Plea AgreementFormer Mississippi Sheriff’s Deputy Indicted for Planting Evidence at Crime Scene to Justify Fatal ShootingRead the Press Release
In an indictment unsealed today, a former Mississippi sheriff’s deputy was charged with planting a weapon at a crime scene to justify a fatal shooting. The indictment charged Walter Grant, 51, with placing a stick or baton near the body of Willie Bingham Jr. after shooting him, in order to mislead investigators into believing that Bingham had possessed a weapon prior to the shooting.
At the time of the incident, Grant was a sheriff’s deputy in Bolivar County, Mississippi. He has since retired. Grant was tried twice in state court for manslaughter; the jury was twice unable to reach a verdict.
If convicted of the federal charge, Grant faces a maximum punishment of 20 years in prison. An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty.
This case is being investigated by the Jackson Division of the Federal Bureau of Investigation, with the cooperation of the Mississippi Attorney General’s Office. It is being prosecuted by Assistant United States Attorney Robert Mims of the Northern District of Mississippi and Trial Attorney Dana Mulhauser of the Civil Rights Division of the Department of Justice.
Former Local Law Enforcement Officer Sentenced for Accepting a Bribe to Protect a Contraband Cigarette Trafficking SchemeRead the Press Release
Acting U.S. Attorney Duane A. Evans announced that GARRETT PARTMAN, age 32, of New Orleans, was sentenced today after previously pleading guilty to a one count Indictment charging him with interstate transportation in aid of racketeering enterprises.
U.S. District Judge Kurt D. Engelhardt sentenced PARTMAN, a former Orleans Parish Sheriff’s Deputy to 3 years of probation.
According to court documents, PARTMAN, along with JUSTIN BROWN and JOSHUA CARTHON, all local law enforcement officers at the time of the Indictment, were utilized to protect and transport the shipment of contraband cigarettes across state lines. Co-defendants, ANWAR ABDELMAJID-AHMAD, JADALLAH SAED, and ATALLA ATALLA, would then distribute and sell the contraband cigarettes in North Carolina and other states where the cigarette taxes are higher than Louisiana, resulting in a total tax loss to the federal and state governments of approximately $456,000.
Acting U.S. Attorney Evans praised the work of the FBI New Orleans Division and Immigration and Customs Enforcement/Homeland Security Investigations in investigating this matter. Assistant United States Attorneys Tracey N. Knight and Irene Gonzalez are in charge of the prosecution.
Former Investment Advisor Who Stole Client’s Retirement Savings Sentenced to 37 Months for Wire Fraud and Investment Advisor FraudRead the Press Release
TRENTON, N.J. – A former financial advisor entrusted with advising clients on investments was sentenced today to 37 months in prison for defrauding his client, a former factory worker, out of his retirement savings and using the funds for his own benefit, Acting U.S. Attorney William E. Fitzpatrick announced.
Jesse Holovacko, 39, of Sayreville, New Jersey, was previously convicted on all counts of an indictment charging him with six counts of wire fraud and one count of investment advisor fraud following a five-day trial before U.S. District Judge Michael A. Shipp, who imposed the sentence today in Trenton federal court.
According to documents filed in this case and the evidence at trial:
Holovacko was an investment advisor at a financial institution located in New Jersey. In 2012, Holovacko went to the factory where the victim worked, met with the victim and some of his co-workers, and signed the victim on as a client, transferring the victim’s pension savings into an Individual Retirement Account (IRA). The victim entrusted Holovacko with managing the victim’s retirement savings.
From December 2013 through August 2014, Holovacko falsely told the victim that he would use retirement account funds to purchase bonds for him and advised the victim to transfer the retirement money to the victim’s bank account and then provide cashier’s checks made out directly to the financial advisor, telling the victim it would make it easier to purchase the bonds. Based on these false representations, Holovacko obtained 18 cashier’s checks totaling approximately $255,000.
Holovacko deposited all of the cashier’s checks into his own personal bank account and spent it for his car loan and mortgage payments, dining out, concerts and clubs, baseball game tickets, as well as taking out approximately $150,000 in cash. In order to continue deceiving the victim, Holovacko promised the victim documentation of the purported investments in bonds.
In addition to the prison term, Judge Shipp sentenced Holovacko to three years of supervised release. Forfeiture and restitution will be determined at a hearing scheduled for Nov. 15, 2017.
Acting U.S. Attorney Fitzpatrick credited postal inspectors with the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Joseph V. Cronin in Newark, and agents with the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt, with the investigation leading to today’s verdict. He also thanked the Financial Industry Regulatory Authority (FINRA) and the N.J. Bureau of Securities of the New Jersey Attorney General’s Office for their assistance.
The government is represented by Assistant U.S. Attorneys Jihee G. Suh and Zach Intrater of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Paul Condon Esq., Jersey City, New Jersey
Former Guatemalan Soccer Official Sentenced to 8 Months’ Imprisonment for Pocketing Bribes and KickbacksRead the Press Release
Earlier today in federal court in Brooklyn, former Guatemalan soccer official Héctor Trujillo was sentenced by United States District Judge Pamela K. Chen to 8 months’ imprisonment following his convictions by guilty plea on June 2, 2017 of one count of wire fraud conspiracy and one count of wire fraud. Trujillo was convicted of these crimes in connection with over $400,000 in bribes and kickbacks that he and other Guatemalan soccer officials received from an American company in connection with the sale of broadcast rights to World Cup qualifier matches. Trujillo himself received nearly $200,000 of these illegal payments, and as part of his plea agreement he agreed to forfeit $175,000 to the government. Also today, Judge Chen found that Trujillo was liable for $415,000 in restitution to the Guatemalan soccer federation, known as “FENAFUTG.” Trujillo served as secretary of the FENAFUTG Executive Committee from approximately 2010 until his arrest in December 2015. At the time of his arrest he also served as a judge on the Constitutional Court of Guatemala.
Bridget M. Rohde, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and R. Damon Rowe, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation, Los Angeles Field Office (IRS), announced the sentence.
“Rather than uphold the standards of honesty and integrity expected of the leadership of international soccer, the defendant and his co-conspirators lined their pockets with hundreds of thousands of dollars in bribes,” stated Acting United States Attorney Rohde. “The defendant has now been brought to justice. This Office and its law enforcement partners at the FBI and IRS will continue to vigorously pursue those who would use leadership positions to engage in corruption, especially when it involves the U.S. banking system.” Ms. Rohde also thanked the United States Department of Justice Office of International Affairs, Organized Crime and Gang Section and Money Laundering and Asset Recovery Section for their assistance in the case, and expressed her appreciation to the government of Guatemala for its cooperation.
“It’s not hard to imagine the honest officials and businesses involved in World Cup Soccer make a lot of money because it’s the most popular sport around the world,” said FBI Assistant Director-in-Charge Sweeney. “But it seems that wasn’t enough for the subjects charged and many convicted in this sweeping corruption investigation. They used their positions and power to use bribes and kickbacks to satiate their greed. This conviction shows we’re not done with our work, and the FBI, Eastern District, IRS and our law enforcement partners won’t stop pursuing those who are abusing the system.”
“Today has seen the first sentencing in a long line of FIFA officials and sports marketing executives involved in systemic corruption in the governance of the world’s game,” stated IRS Criminal Investigation’s Special Agent-in-Charge Rowe. “This defendant used his position of trust to line his pockets and cheat the National Football Federation of Guatemala of his fair and honest services. IRS Criminal Investigation is proud to use our financial investigative expertise to root out the corruption which has plagued this sport for decades, while at the same time ensuring the integrity of the United States financial system.”
Background[1]
The sport of soccer is governed worldwide by the Féderation Internationale de Football Association (“FIFA”), FIFA’s constituent continental confederations (including CONCACAF, the confederation covering North America, Central America and the Caribbean), and FIFA’s constituent national member associations (which are also known as federations), including FENAFUTG. Since 2004, officials of these soccer governing bodies were bound by FIFA’s code of ethics, which, among other things, imposes a fiduciary duty on soccer officials in favor of FIFA, the continental confederations, and the member associations, and prohibits soccer officials from taking bribes or kickbacks.
FENAFUTG owned the media and marketing rights to soccer matches it played on its home territory during the qualifying stages for the men’s World Cup tournament. FENAFUTG, like many other soccer governing bodies, typically sold these rights to sports marketing companies that served as middlemen, which in turn sold different portions of the rights to different broadcasters and media companies around the world.
2018 World Cup Qualifier Cycle Bribes
In late 2009, Trujillo’s associate and co-defendant Brayan Jiménez was elected president of FENAFUTG, and Trujillo was selected to serve as secretary of the FENAFUTG executive committee. Soon afterwards, in February 2010, Trujillo, Jiménez and Rafael Salguero, a Guatemalan member of the FIFA executive committee, traveled from Guatemala to Miami to meet with executives of Media World, an American sports marketing company based there. During this meeting, Trujillo and Jiménez negotiated with the executives to sell Media World the overseas media and marketing rights to Guatemala’s home World Cup qualifier matches in advance of the 2018 World Cup.
Also during this meeting in Miami, Trujillo and Jiménez agreed to accept from Media World $200,000 in bribe and kickback payments in connection with selling these rights to Media World, to be split between the two of them. After Jiménez signed the contract on behalf of FENAFUTG, during the following months Media World wired a total of $195,000 from its bank account in Miami to the Panamanian bank account of an intermediary who then transferred the funds to Trujillo’s bank account in Guatemala. On some occasions, the conspirators falsely described the payments in the wire transfer instructions as legal fees for Trujillo. Trujillo distributed a little more than half of the $195,000 to Jiménez in Guatemala and kept the rest for himself. Salguero also received a disguised $20,000 payment for his role in facilitating the deal.
2022 World Cup Qualifier Cycle Bribes
In 2013, a Media World executive traveled to Guatemala for negotiations with Jiménez and Trujillo to renew the contract for the overseas media rights to FENAFUTG’s World Cup qualifier matches, this time for the matches leading up to the 2022 World Cup. Jiménez and Trujillo agreed to renew the contract, and again agreed to accept $200,000 in bribe and kickback payments in connection with selling these rights to Media World.
To facilitate the hidden payment of these bribes, Trujillo made use of an acquaintance who lived in the United States and owned an American construction business. Specifically, Trujillo directed a Media World executive to wire the $200,000 in bribe money to the construction company’s United States bank account, which Media World did, from its bank account in Miami. To hide the true nature of the bribe payment, the conspirators fabricated a sham contract for construction services between the construction company and a Media World affiliate. Trujillo’s associate transferred most of this money to a bank account in Guatemala, where Trujillo could withdraw it. Trujillo again gave about half of the money to Jiménez and kept the rest for himself.
The government’s case is being handled by the Office’s FIFA Task Force. Assistant United States Attorneys Paul Tuchmann, Samuel P. Nitze, M. Kristin Mace, Keith D. Edelman, Kaitlin T. Farrell, and Brian D. Morris are in charge of the prosecution.
The Defendant:
HÉCTOR TRUJILLO
Age: 63
Citizenship: GuatemalaE.D.N.Y. Docket No. 15-CR-252 (PKC)
[1] The information described below is set forth in various court filings and statements made during court appearances in this case and related cases.
Former Air Force Member Sentenced for Child Pornography OffensesRead the Press Release
BOSTON – A former Air Force staff sergeant was sentenced yesterday in federal court in Boston for receiving and possessing child pornography depicting prepubescent girls engaged in sex acts with men.
John Tran, 30, of Waltham, was sentenced by U.S. District Court Chief Judge Patti B. Saris to five years in prison and five years of supervised release. On March 23, 2017, Tran pleaded guilty to one count of possession of child pornography and one count of receipt of child pornography.
Tran was arrested on Nov. 16, 2015, at his home in Waltham after law enforcement officers executed a federal search warrant at his residence and found child pornography on his computer. Tran used his computer to access child pornography websites known by federal authorities. Investigators became aware of Tran’s illegal activities while monitoring the specific website used by Tran. In their search, investigators found 11 videos containing child pornography and a number of still images of child pornography on Tran’s computer.
Acting United States Attorney William D. Weinreb; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Waltham Police Chief Keith MacPherson made the announcement today. Assistant U.S. Attorney David G. Tobin of Weinreb’s Major Crimes Unit prosecuted the case.
Five Chinese Citizens and Four Chinese Companies Indicted in Scheme to Sell Mislabeled Dietary SupplementsRead the Press Release
WASHINGTON — A Dallas, Texas, grand jury returned two indictments today against five Chinese citizens and four companies alleging fraud and other charges, the Justice Department announced. The charges relate to alleged sales of stimulants intended for inclusion in dietary supplements.
The indictments charge the defendants with participation in a scheme to produce and sell dietary supplements containing hidden synthetic stimulants, such as 2-amino-6-methylheptane (“DMHA”). The charges also involve alleged shipments of 1,3-dimethylamylamine (“DMAA”) and DMHA. DMAA, which is chemically similar to DMHA, has been linked to severe adverse events such as heart attacks and strokes.
The indictments allege that the defendants knew major American dietary supplement retailers would not carry supplements containing these stimulant ingredients. The indictments also allege the defendants agreed with a confidential government informant to either mislabel ingredients or otherwise help to hide the true nature of a proposed dietary supplement from retailers. None of the ingredients allegedly shipped during the undercover investigation were sold to consumers.
“It is unlawful for companies both outside and inside the United States to conceal questionable, dangerous, or illegal ingredients in dietary supplements sold to American consumers,” said Chad A. Readler, Acting Assistant Attorney General of the Department of Justice’s Civil Division. “These cases demonstrate the Department of Justice’s commitment to ensuring that dietary supplements are safe and accurately labeled.”
“U.S. consumers trust that their dietary supplements are safe and contain appropriate labeling. When unscrupulous producers add undeclared or misidentified ingredients to dietary supplements, there is no assurance that the product is safe for consumption,” said Catherine A. Hermsen, Acting Director, FDA Office of Criminal Investigations. “The FDA will continue to pursue and bring to justice those who participate in fraudulently marketing dietary supplements to the detriment of public health.”
The first indictment charges Genabolix USA Inc., a Nevada corporation; Shanghai Yongyi Bioltechnology Ltd., a Chinese corporation; Hu Chang Chun (a.k.a. James Hu), 44, of Shanghai, China, the principal of Genabolix; Gao Mei Fang (a.k.a. Amy Gao), 41, of Shanghai, China, the supply chain manager for Genabolix; and Zhang Xiao Dong (a.k.a. Mark Zhang), 31, of Shanghai, China, the sales manager for Genabolix, with mail fraud. The indictment also charges Genabolix, Shanghai Yongyi, Hu, and Gao with introducing misbranded food into interstate commerce. In addition, the indictment charges Genabolix, Yongyi, and Gao with obstruction of an agency proceeding and smuggling.
A second indictment charges Shanghai Waseta International Trade Co. Ltd., a Chinese corporation; Max Pharmatech Inc., a California corporation; Xu Jia Bao (a.k.a. Fred Xu), 48, of Shanghai, China, the principal of Shanghai Waseta; and Li Ting Ting (a.k.a. Sunny Lee), 37, of Shanghai, China, the overseas sales manager for Shanghai Waseta, with wire fraud and with introducing misbranded food into interstate commerce. The indictment also charges Shanghai Waseta with smuggling.
Gao Mei Fang, Zhang Xiao Dong, and Xu Jia Bao were arrested in late September at a dietary supplement trade show in Las Vegas and remain in custody. A date for trial before the federal district court in Dallas has not yet been set. The remaining individual defendants are not believed to be in the United States.
“Few things are more important than ensuring the safety of what we put into our bodies,” said U.S. Attorney John Parker for the Northern District of Texas. “Those who deliberately mislead us on this critical issue will be prosecuted to the fullest extent of our laws.”
An indictment is an accusation by a federal grand jury and is not evidence of guilt. The defendants should be presumed innocent unless and until proven guilty.
Upon conviction, the maximum statutory penalties for the individual defendants are 20 years’ imprisonment and a $250,000 fine for mail fraud or wire fraud; one year imprisonment and a $100,000 fine for the introduction of misbranded food into interstate commerce; three years’ imprisonment and a $250,000 fine for the introduction of misbranded food into interstate commerce with the intent to defraud or mislead; five years’ imprisonment and a $250,000 fine for obstruction of an agency proceeding; and 20 years’ imprisonment and a $250,000 fine for smuggling.
The FDA Office of Criminal Investigations-Dallas Division investigated the case. The case is being prosecuted by Assistant U.S. Attorneys Kathryn Rumsey and Errin Martin of the Northern District of Texas and Trial Attorneys David Sullivan and Patrick Runkle of the Justice Department’s Consumer Protection Branch.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Northern District of Texas, visit its website at https://www.justice.gov/usao-ndtx.
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Five Chinese Citizens and Four Chinese Companies Indicted in Scheme to Sell Mislabeled Dietary SupplementsRead the Press Release
A Dallas, Texas, grand jury returned two indictments today against five Chinese citizens and four companies alleging fraud and other charges, the Justice Department announced. The charges relate to alleged sales of stimulants intended for inclusion in dietary supplements.
The indictments charge the defendants with participation in a scheme to produce and sell dietary supplements containing hidden synthetic stimulants, such as 2-amino-6-methylheptane (“DMHA”). The charges also involve alleged shipments of 1,3-dimethylamylamine (“DMAA”) and DMHA. DMAA, which is chemically similar to DMHA, has been linked to severe adverse events such as heart attacks and strokes.
The indictments allege that the defendants knew major American dietary supplement retailers would not carry supplements containing these stimulant ingredients. The indictments also allege the defendants agreed with a confidential government informant to either mislabel ingredients or otherwise help to hide the true nature of a proposed dietary supplement from retailers. None of the ingredients allegedly shipped during the undercover investigation were sold to consumers.
“It is unlawful for companies both outside and inside the United States to conceal questionable, dangerous, or illegal ingredients in dietary supplements sold to American consumers,” said Chad A. Readler, Acting Assistant Attorney General of the Department of Justice’s Civil Division. “These cases demonstrate the Department of Justice’s commitment to ensuring that dietary supplements are safe and accurately labeled.”
“U.S. consumers trust that their dietary supplements are safe and contain appropriate labeling. When unscrupulous producers add undeclared or misidentified ingredients to dietary supplements, there is no assurance that the product is safe for consumption,” said Catherine A. Hermsen, Acting Director, FDA Office of Criminal Investigations. “The FDA will continue to pursue and bring to justice those who participate in fraudulently marketing dietary supplements to the detriment of public health.”
The first indictment charges Genabolix USA Inc., a Nevada corporation; Shanghai Yongyi Bioltechnology Ltd., a Chinese corporation; Hu Chang Chun (a.k.a. James Hu), 44, of Shanghai, China, the principal of Genabolix; Gao Mei Fang (a.k.a. Amy Gao), 41, of Shanghai, China, the supply chain manager for Genabolix; and Zhang Xiao Dong (a.k.a. Mark Zhang), 31, of Shanghai, China, the sales manager for Genabolix, with mail fraud. The indictment also charges Genabolix, Shanghai Yongyi, Hu, and Gao with introducing misbranded food into interstate commerce. In addition, the indictment charges Genabolix, Yongyi, and Gao with obstruction of an agency proceeding and smuggling.
A second indictment charges Shanghai Waseta International Trade Co. Ltd., a Chinese corporation; Max Pharmatech Inc., a California corporation; Xu Jia Bao (a.k.a. Fred Xu), 48, of Shanghai, China, the principal of Shanghai Waseta; and Li Ting Ting (a.k.a. Sunny Lee), 37, of Shanghai, China, the overseas sales manager for Shanghai Waseta, with wire fraud and with introducing misbranded food into interstate commerce. The indictment also charges Shanghai Waseta with smuggling.
Gao Mei Fang, Zhang Xiao Dong, and Xu Jia Bao were arrested in late September at a dietary supplement trade show in Las Vegas and remain in custody. A date for trial before the federal district court in Dallas has not yet been set. The remaining individual defendants are not believed to be in the United States.
“Few things are more important than ensuring the safety of what we put into our bodies,” said U.S. Attorney John Parker for the Northern District of Texas. “Those who deliberately mislead us on this critical issue will be prosecuted to the fullest extent of our laws.”
An indictment is an accusation by a federal grand jury and is not evidence of guilt. The defendants should be presumed innocent unless and until proven guilty.
Upon conviction, the maximum statutory penalties for the individual defendants are 20 years’ imprisonment and a $250,000 fine for mail fraud or wire fraud; one year imprisonment and a $100,000 fine for the introduction of misbranded food into interstate commerce; three years’ imprisonment and a $250,000 fine for the introduction of misbranded food into interstate commerce with the intent to defraud or mislead; five years’ imprisonment and a $250,000 fine for obstruction of an agency proceeding; and 20 years’ imprisonment and a $250,000 fine for smuggling.
The FDA Office of Criminal Investigations-Dallas Division investigated the case. The case is being prosecuted by Assistant U.S. Attorneys Kathryn Rumsey and Errin Martin of the Northern District of Texas and Trial Attorneys David Sullivan and Patrick Runkle of the Justice Department’s Consumer Protection Branch.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Northern District of Texas, visit its website at https://www.justice.gov/usao-ndtx.
Five Assistant U.S. Attorneys from Southern California to Receive Attorney General’s Award for Response to San Bernardino AttackRead the Press Release
LOS ANGELES – In a ceremony this afternoon at the Department of Justice in Washington, five Assistant United States Attorneys are receiving the Attorney General’s Award for Excellence in Furthering the Interests of U.S. National Security for being part of the federal team that responded to the San Bernardino terrorist attack.
The five AUSAs and 10 other members of the federal response team are being recognized by Attorney General Jeff Sessions for their outstanding achievements and contributions towards protecting U.S. National security. The five prosecutors were part of a team that responded immediately after the shooting rampage at the San Bernardino Inland Regional Center (IRC) on December 2, 2015. Members of the team worked around the clock for weeks to ensure that justice was served after the terrorist attack that took the lives of 14 innocent people and wounded 22 others.
The team quickly identified the assailants, discovered their pledge of allegiance to the Islamic State of Iraq and Syria (ISIS), and unearthed earlier plots to attack Inland Empire targets – plans that involved one of the shooters and Enrique Marquez Jr., the man who supplied the two of the firearms used in the IRC attack and who is pending sentencing after pleading guilty to federal charges that include providing material support and resources to terrorists. The team also uncovered an immigration fraud scheme involving Marquez and one of the attackers’ family members that has resulted in three additional guilty pleas.
The AUSAs receiving the Attorney General’s Award today are: Patrick R. Fitzgerald, Chief of the National Security Division; Christopher D. Grigg, Chief of the Terrorism and Export Crimes Section; Deirdre Z. Eliot of the Santa Ana Branch Office; Melanie A. Hanson, who is based in Los Angeles; and Jay H. Robinson of the Riverside Branch Office.
The five federal prosecutors – all members of the National Security Division in the United States Attorney’s Office – are being honored along with 10 other people, including Washington-based attorneys with the Justice Department and special agents with the FBI and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
The five prosecutors are being honored today at a ceremony at the Justice Department in Washington, D.C. being attended by the honorees, their families and Acting United States Attorney Sandra R. Brown.
“These federal prosecutors represent the highest ideals of the Justice Department – including unwavering dedication, commitment and professionalism – as they worked with their federal and state law enforcement colleagues to uncover every aspect of the attack and to ensure there was no further threat,” said Acting United States Attorney Brown said. “The work done in this case reflects on the entire Department of Justice, and I could not be more proud of the work done by these excellent attorneys.”
The other members of the San Bernardino federal response team being honored today are: FBI Special Agents Christopher Pluhar, Joel T. Anderson, Martin E. Burry, Nathan T. Elias, Theodore C. Nevatt, Patrick M. Race, and Thomas J. Ropel III; ATF Resident Agent in Charge Adam D. Ekstrom; and Justice Department Trial Attorneys Matthew F. Blue and C. Alexandria Bogle of the Counterterrorism Section.
Attorney General Sessions will recognize 202 Justice Department employees and 19 other people for their distinguished public service today at the 65th Annual Attorney General’s Awards Ceremony. The annual ceremony recognizes individuals for their outstanding service and dedication to carrying out the mission of the Department of Justice.
“Every single day, the 115,000 men and women of the Department of Justice work to protect our national security against terrorist threats, defend the civil rights of all Americans, reduce violent crime in our communities, stop deadly drug dealers and their organizations, and strengthen the rule of law,” said Attorney General Sessions. “This work benefits every American, and each Department of Justice employee plays a role that helps us accomplish our objectives. Today, we take a moment to recognize those who have distinguished themselves by exemplary service to the Department. Each one of these men and women – through their dedication and commitment – has made a difference. Meeting with them and their families today, I am more confident than ever that the Department – and the safety of the American people – are in good hands.”
Essex County, New Jersey, Man Pleads Guilty to Armed Robbery and CarjackingRead the Press Release
NEWARK, N.J. –A Newark man today admitted robbing a Newark jewelry store and then stealing a car at gunpoint immediately afterwards, Acting U.S. Attorney William E. Fitzpatrick announced.
Orlando Nieves-Velez, 29, pleaded guilty before U.S. District Judge Claire C. Cecchi in Newark federal court to an indictment charging him with one count of Hobbs Act robbery, one count of carjacking, and one count of using a firearm in furtherance of a crime of violence.
According to the documents filed in this case and statements made in court:
On Dec. 1, 2016, Nieves-Velez robbed a jewelry store in Newark while brandishing a firearm. During the robbery, Nieves-Velez pressed a gun to the back of an employee’s neck and threatened to shoot him if the other employees didn’t give him jewelry.
After leaving the store with more than $20,000 in jewelry, Nieves-Velez stepped in front of a 2006 Nissan Altima. Nieves-Velez pointed his gun at the driver and ordered the driver out of the car. Nieves-Velez fired his gun into the air before fleeing in the Altima.
The charge of Hobbs Act robbery carries a maximum penalty of 20 years in prison. The carjacking charge carries a maximum potential penalty of 15 years in prison. Nieves-Velez also faces a mandatory minimum prison term of 10 years in prison for discharging his weapon in connection with the carjacking, which must be served consecutively to any other sentence imposed. Each of these counts also carries a maximum fine of $250,000. Sentencing is scheduled for Feb. 20, 2018.
Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, the U.S. Marshals Service, under the direction of U.S. Marshal Juan Mattos in Newark, and the Newark Department of Public Safety, under the direction of Director Anthony F. Ambrose, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Sammi Malek of the U.S. Attorney’s Office Criminal Division in Newark.
Defense Counsel: Kevin Carlucci Esq., Assistant Federal Public Defender, Newark
Edwardsville Man Convicted of Felon Not to Possess A FirearmRead the Press Release
SCRANTON- The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Victor Santiago-Rivera, age 42, of Edwardsville, Pennsylvania, was convicted on October 19, 2017, of being a felon in possession of a firearm after a three-day jury trial held before U.S. District Court Judge Malachy Mannion.
According to United States Attorney Bruce D. Brandler, beginning in December 2016, Santiago-Rivera, who has multiple felony convictions in his criminal history, repeatedly requested that an individual obtain a gun for him to use in a robbery of a local jewelry store. That individual was a confidential informant and contacted law enforcement. On January 6, 2017, law enforcement agents monitored the controlled exchange of the firearm to Santiago-Rivera. The jury was unable to come to a unanimous verdict on one count of attempted robbery.
The investigation was conducted by the Alcohol, Tobacco, Firearms and Explosives and the Kingston Borough Police Department. Assistant United States Attorneys Jenny P. Roberts and Phillip Caraballo prosecuted the case.
This case was brought as part of the Violent Crime Reduction Partnership (“VCRP”), a district wide initiative to combat the spread of violent crime in the Middle District of Pennsylvania. Led by the United States Attorney’s Office, the VCRP consists of federal, state and local law enforcement agencies whose mission is to locate, apprehend, and prosecute individuals who commit violent crimes with firearms.
A sentence following a finding or guilt is imposed by the judge after consideration of the applicable Federal sentencing statutes and the Federal Sentencing Guidelines.
Santiago-Rivera is facing a mandatory minimum penalty of 15 years imprisonment and a maximum possible penalty of life 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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East Stroudsburg Man Indicted on Robbery, Drug Trafficking and Firearm ChargesRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Nicolaus Harman, age 21, of East Stroudsburg, Pennsylvania, was indicted on October 24, 2017, by a federal grand jury on robbery, drug trafficking, and firearm charges.
According to United States Attorney Bruce D. Brandler, the indictment alleges that on April 16, 2017, in Monroe County, Harman, along with others, conspired to rob a heroin dealer for his cash and heroin. During the course of that robbery, Harman allegedly committed and threatened physical violence towards the victim. At the time of the robbery, Harman had previously been convicted of a felony and was not legally permitted to possess a firearm (a Ruger P-85 9mm handgun).
The case was investigated by the U.S. Federal Bureau of Investigation and the Stroud Regional Police Department. Assistant U.S. Attorney Sean A. Camoni is prosecuting the case.
This case was brought as part of the Violent Crime Reduction Partnership (“VCRP”), a district wide initiative to combat the spread of violent crime in the Middle District of Pennsylvania. Led by the United States Attorney’s Office, the VCRP consists of federal, state and local law enforcement agencies whose mission is to locate, apprehend, and prosecute individuals who commit violent crimes with firearms.
This case was further 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.
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 for this offense is life 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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Dona Ana County Man Facing Federal Child Sexual Exploitation and Child Pornography ChargesRead the Press Release
ALBUQUERQUE – A U.S. Magistrate Judge sitting in Las Cruces, N.M., today found probable cause to support a criminal complaint charging Juan Martin Rosales, 48, of Chaparral, N.M., with sexual exploitation of children and receipt and possession of child pornography. During today’s proceedings, Rosales was ordered detained pending trial.
The criminal complaint alleges that Rosales sexually exploited children and received and possessed child pornography from Oct. 2015 through Oct 16, 2017, in Dona Ana County, N.M. According to the complaint, the investigation into Rosales was initiated in April 2017, when Rosales’ neighbors went to the Dona Ana County Sheriff’s Office to report that Rosales allegedly possessed a tablet computer containing child pornography. The complaint further alleges that Rosales used a cellular phone to take photographs of children engaged in sexually explicit conduct. During the execution of a search warrant on Oct. 16, 2017, law enforcement agents allegedly recovered numerous SD cards, cellular phones, a tablet computer and other electronic devices from Rosales’ home, which allegedly contain child pornography. Rosales was arrested that day on related state charges.
If convicted of the child sexual exploitation charge, Rosales faces a statutory mandatory minimum penalty of 15 years and a maximum of 30 years in federal prison. If convicted of receiving child pornography, Rosales faces a statutory mandatory minimum penalty of five years and a maximum of 20 years in federal prison. If convicted of possessing child pornography, Rosales faces a statutory maximum penalty of 20 years in federal prison. Charges in criminal complaints are merely accusations and defendants are presumed innocent unless found guilty in a court of law.
This case was investigated by the Las Cruces office of Homeland Security Investigations, the Dona Ana County Sheriff’s Office, Las Cruces Police Department and the Otero County Sheriff’s Office. Assistant U.S. Attorney Alexander B. Shapiro of the U.S. Attorney’s Las Cruces Branch Office is prosecuting the case as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. Individuals with information relating to suspected child predators and suspected child abuse are encouraged to contact the Children’s Advocacy Center tipline at (575) 526-3437.
DEA in Michigan along with local law enforcement partners hold Prescription Drug Take Back Day this SaturdayRead the Press Release
196 prescription take back locations across Michigan
Detroit – This Saturday, October 28, from 10 a.m. to 2 p.m. local time the federal Drug Enforcement Administration (DEA) and its local law enforcement, community and tribal partners will give the public its 14th opportunity in seven years to prevent pill abuse and theft by ridding their homes of potentially dangerous expired, unused, and unwanted prescription drugs.
Individuals can take pills and other solid forms of medication to one of almost 5,000 collection sites nationwide, and 196 sites in Michigan, manned by more than 4,000 partners nationwide. (DEA cannot accept liquids, needles or sharps.) They can find nearby collection sites at www.DEATakeBack.com or by calling 800-882-9539. The service is free and anonymous, no questions asked.
“Disposing of leftover painkillers or other addictive medicines in the house is one of the best ways to prevent a member of your family from becoming a victim of the opioid epidemic,” said DEA Acting Administrator Robert W. Patterson. “More people start down the path of addiction through the misuse of opioid prescription drugs than any other substance. The abuse of these prescription drugs has fueled the nation’s opioid epidemic, which has led to the largest rate of overdose deaths this country has ever seen.”
This initiative addresses a vital public safety and public health issue. Medicines that languish in home cabinets are highly susceptible to diversion, misuse, and abuse. Rates of prescription drug abuse in the U.S. are alarmingly high, as are the number of accidental poisonings and overdoses due to these drugs. Studies show that a majority of abused prescription drugs are obtained from family and friends, including from the home medicine cabinet. DEA launched its prescription drug take back program when both the Environmental Protection Agency and the Food and Drug Administration advised the public that their usual methods for disposing of unused medicines—flushing them down the toilet or throwing them in the trash—posed potential safety and health hazards.
Last April the public turned in 450 tons (900,000 pounds) of prescription drugs at almost 5,500 sites operated by the DEA and more than 4,200 of its state and local law enforcement partners. Overall, in its 13 previous Take Back events, DEA and its partners have taken in over 8.1 million pounds—more than 4,050 tons—of pills.