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Friday 26 May 2017
Dr. Couch and Dr. Ruan Sentenced to 240 and 252 Months in Federal Prison for Running Massive Pill MillRead the Press Release
Acting United States Attorney Steve Butler of the Southern District of Alabama, announces that Dr. John Patrick Couch and Dr. Xiulu Ruan were sentenced to 240 months and 252 months, respectively, in federal prison for running a massive pill mill in Mobile, Alabama.
During the sentencing hearing today, Senior Judge Callie V.S. Granade found the doctors were responsible for illegally prescribing opioids, which when converted to their marijuana equivalency, exceeded 90,000 kilograms of marijuana. In addition, she found that both doctors perjured themselves, and that they utilized special skills to carry out their criminal enterprise. Thereafter, several family members of deceased Dr. Couch patients spoke to the Court, as did several patients on behalf of the doctor. Ultimately, Judge Granade sentenced Dr. Couch to 240 months, and Dr. Ruan to 252 months, in federal prison. Dr. Ruan received a longer sentence based on Judge Granade’s finding that he was the leader of their criminal enterprise. In addition, she ordered them to pay restitution in the following amounts: $6,282,023.00 to Medicare, $3,649,092.97 to Blue Cross/Blue Shield of Alabama, $2,285,170.70 to Tricare, and $1,695,929.00 to United Heath Group.
Prior to the execution of multiple search warrants by the FBI and DEA on May 20, 2015, Dr. Ruan and Dr. Couch jointly owned and operated two pain management clinics under the name Physicians Pain Specialists of Alabama (“PPSA”) as well as C&R Pharmacy. Following an extensive joint investigation by both FBI-Mobile and DEA-Mobile, both doctors were charged with a litany of federal felony offenses, including RICO conspiracy, conspiracy to violate the Controlled Substances Act, substantive drug distribution offenses, conspiracies to commit wire fraud, mail fraud, healthcare fraud, and to violate the Anti-Kickback Statute, as well as money laundering. All charges stemmed from the defendants’ operation of PPSA and C&R Pharmacy.
During the seven-week trial, which lasted from early January to late February, the United States presented evidence that Dr. Ruan and Dr. Couch utilized PPSA and C&R Pharmacy as a criminal enterprise to violate the Controlled Substances Act and to commit mail and wire fraud, in violation of the RICO Act. Specifically, the jury saw evidence that the defendants knowingly and willfully prescribed Schedule II and III Controlled Substances, including fentanyl, outside the usual course of professional practice and not for a legitimate medical purpose. The United States argued the defendants’ motive for this illegal prescribing was their own financial self-interest. The United States also argued that the defendants’ billing practices were systematically designed to unlawfully enrich the doctors.Of particular importance in the trial were two brand name instant-release fentanyl drugs — Subsys and Abstral. Both Subsys and Abstral are only FDA-indicated for breakthrough cancer pain in opioid-tolerant adult patients. However, evidence showed that Dr. Ruan and Dr. Couch almost exclusively prescribed these drugs off-label for neck, back, and joint pain. The jury found that Dr. Ruan and Dr. Couch received illegal kickbacks from Insys Therapeutics, the manufacturer of Subsys, in exchange for the defendants prescribing massive quantities of this drug. Dr. Ruan and Dr. Couch were both among the top prescribers of Subsys in the entire United States. Evidence showed that Dr. Ruan began donating his Insys kickback payments the day after he received a copy of a criminal complaint from the Eastern District of Michigan against Dr. Gavin Awerbuch, another prolific Subsys prescriber who had been charged with receiving kickbacks from Insys. The United States argued that Dr. Ruan’s decision to donate his Insys money was done in an attempt to distance himself from the company.
With regard to Abstral, evidence showed that Dr. Ruan and Dr. Couch purchased approximately $1.6 million worth of stock in Galena Biopharma, the manufacturer of Abstral, and sought to manipulate the stock price by driving up Abstral sales. From the third quarter of 2013 through the 2014, Dr. Ruan and Dr. Couch were the number one and two prescribers of Abstral in the entire United States. During this same time period, nearly one out of every three Abstral prescriptions written in the U.S. were written by either Dr. Ruan or Dr. Couch.
As part of their criminal enterprise, Dr. Ruan and Dr. Couch owned C&R Pharmacy, which was co-located with one of the PPSA clinic locations. C&R Pharmacy would only fill prescriptions written by the doctors at PPSA, and Dr. Ruan and Dr. Couch split 75% of the profits that came in from the prescription drug reimbursements. Approximately 91% of the Subsys and Abstral prescriptions written by the defendants — which cost patients’ insurance anywhere between $1,000.00 to $24,000.00 per month — were filled at C&R Pharmacy.
In addition to C&R Pharmacy, the defendants also had a worker’s compensation dispensary, from which they directly dispensed Controlled Substances. The jury heard evidence that Dr. Ruan and Dr. Couch received guaranteed monthly kickbacks from a dispensary management company — Industrial Pharmaceuticals Management (“IPM”) and later Comprehensive Rx (“CRX”) — in exchange for the defendants dispensing certain drugs with high reimbursement rates. These monthly guaranteed amounts reached $80,000.00 per month for Dr. Ruan and $20,000.00 per month for Dr. Couch. The millions paid in kickbacks to the defendants associated with the worker’s compensation dispensary went into private bank accounts set up by the defendants.
While there were some patients who received legitimate medical care at PPSA, the jury heard evidence that many patients rarely saw either of the doctors, and that the nurse practitioners who treated Dr. Couch’s patients were abusing drugs at the work place and then seeing patients. In addition, the jury heard evidence that Dr. Couch knowingly permitted one of his nurse practitioners, Justin Palmer, to forge Dr. Couch’s name on prescriptions for Controlled Substances. Palmer testified that he forged Dr. Couch’s name approximately 25,000 times while working at PPSA.
After seven-weeks of trial, 81 witnesses, and three days of deliberation, the jury reached the following verdicts: Both doctors were convicted of (1) RICO conspiracy; (2) Conspiracy to prescribe Schedule II and III Controlled Substances outside the usual course of professional practice; (3) Conspiracy to prescribe more than 40 grams of fentanyl outside the usual course of professional practice; (4) Conspiracy to commit healthcare fraud; (5) Conspiracy to commit mail and wire fraud; (6) Conspiracy to receive illegal kickbacks from IPM/CRX related to the workers compensation dispensary; and (7) Conspiracy to receive illegal kickbacks from Insys Therapeutics in exchange for prescribing Subsys. In addition, Dr. Ruan was convicted of both conspiracy and substantive money laundering counts. Each doctor was also convicted of several substantive illegal drug distribution counts related to prescriptions written to particular patients. Dr. Ruan was acquitted of one substantive charge related to prescriptions written for a patient.
Following their convictions, the defendants agreed to forfeit to the United States several houses, beach condos, and bank accounts, as well as 23 luxury cars, including multiple Bentleys, Lamborghinis, Mercedes, and Ferraris. In addition to the forfeited property, each doctors agreed to an additional $5,000,000.00 money judgment. The United States is currently in the process of preparing to sell at auction the forfeited vehicles and property.
Prior to trial, Justin Palmer and Bridgette Parker, both nurse practitioners for Dr. Couch, pled guilty to conspiring to prescribe Controlled Substances outside the usual course of professional practice and not for a legitimate medical purpose. They have already been sentenced to federal prison for 30 months and 20 months, respectively. Christopher Manfuso, who worked for IPM and later owned CRX, pled guilty to conspiring to pay illegal kickbacks to the doctors. He has been sentenced to 6 months home confinement and a $50,000.00 fine. Finally, Insys Therapeutics drug rep Natalie Perhacs pled guilty to conspiring to pay illegal kickbacks associated with the prescribing of Subsys. Perhacs currently awaits sentencing. All four testified against the doctors at trial.
Acting United States Attorney Steve Butler said, “Any medical professional who chooses to place profit over patient care should heed the lengthy sentences received by Dr. Couch and Dr. Ruan. We commend the victims’ family members who spoke so eloquently over the past two days about how the defendants’ criminal conduct impacted, and continues to impact, their lives on a daily basis. Furthermore, thank you to our law enforcement partners at the FBI and DEA for their persistence in seeing that justice was done in this important case of national interest. Considering that opioid abuse and trafficking is of significant concern not only to us here in south Alabama, but nationwide, our office will continue to vigorously prosecute these cases.”
“The DEA is committed to investigating and bringing to justice those who divert and traffic prescription drugs,” said Special Agent in Charge Stephen G. Azzam of the Drug Enforcement Administration’s New Orleans Field Office. “Opiate abuse is a major problem in Alabama and throughout the nation. The diversion of prescription pain killers contributes to the widespread abuse of opiates and is a gateway to heroin addiction, which is devastating our local communities. This investigation demonstrates the strength of collaborative law enforcement efforts in Alabama and our strong partnership with the U.S. Attorney’s Office to aggressively pursue anyone who illicitly distributes these drugs. The lengthy sentences received by Dr. Ruan and Dr. Couch appropriately reflect the devastation they caused. These sentences will protect the community from these convicted felons and hopefully deter other medical practitioners who are inclined to put profit over patient health and safety,” said Azzam.
FBI-Mobile Special Agent in Charge Robert Lasky stated, “The FBI is committed to the relationships with the law enforcement community that make these types of investigations possible. We will continue to target illegal activity in the medical profession as was apparent in this case.”
This OCDETF case was jointly investigated by the DEA-Mobile and FBI-Mobile, and was prosecuted by Assistant U.S. Attorneys Christopher Bodnar and Deborah Griffin.
Defense Contractors Sentenced for Stealing Medical Equipment Intended for Deployed MarinesRead the Press Release
Assistant U.S. Attorneys W. Mark Conover (619) 546- 6763
Michelle L. Wasserman (619) 546-8431
NEWS RELEASE SUMMARY –May 26, 2017
SAN DIEGO – Henry Bonilla and Richard Navarro were sentenced in federal court today to 15 months and 12 months in prison, respectively, for conspiring to steal over $3 million worth of medical equipment from Camp Pendleton that the military had planned to ship overseas to treat injured Marines.
“This isn’t the theft of pencils and pens,” U.S. District Judge Cathy Ann Bencivengo told the defendants during today’s sentencing hearing. “This medical equipment was meant for U.S. Troops. This type of theft is outrageous and puts our troops at risk. I hope this sentence will send a message to people in government in positions of trust.”
Bonilla, Navarro and their co-conspirators - many of whom likewise have pleaded guilty - worked as civilian defense contractors in warehouses run by 1st Medical Logistics Company (“1st MEDLOG”) aboard Camp Pendleton. 1st MEDLOG is the unit responsible for maintaining medical equipment and shipping necessary medical items to combat forces throughout the world. By virtue of their employment as contractors, Bonilla and Navarro had access to sophisticated, expensive medical equipment stored at 1st MEDLOG warehouses.
According to court records, Bonilla and Navarro and their co-conspirators stole expensive medical equipment from 1st MEDLOG, including anesthesia machines, autoclaves, ventilators, ultrasound machines, defibrillators, and laryngoscopes among other items. Bonilla and Navarro removed the items from Camp Pendleton, with the help of their co-conspirators, and sold the equipment to medical equipment resellers.
Acting U.S. Attorney Alana W. Robinson would like to remind the public that these charges were the result of ongoing efforts to root out corruption among our area defense contractors. She encouraged the public to contact the Naval Criminal Investigative Service (NCIS) at 1-800-264-6485 or www.ncis.navy.mil with any information relevant to the ongoing investigation into theft of medical equipment at Camp Pendleton.
Judge Bencivengo ordered Bonilla to forfeit two vehicles and $172,850 in ill-gotten gains, and ordered Navarro to forfeit $49,210. Judge Bencivengo also ordered that both Bonilla and Navarro pay restitution of the value of the $3 million worth of equipment stolen from the U.S. Marine Corps.
DEFENDANTS Case Number: 16CR2053-CAB
Henry Bonilla Age: 29 Pomona, California
Richard Navarro Age: 44 Oceanside, California
SUMMARY OF CHARGES
Count 1: Conspiracy to Engage in Theft of Government Property, Title 18, United States Code, Section 371
Maximum penalties: 5 years in prison, $250,000 fine, term of supervised release of 3 years, restitution, and $100 special assessment.
INVESTIGATING AGENCY
Naval Criminal Investigative Service
Defense Contractor Resolves Criminal, Civil and Administrative Liability Related to Food ContractsRead the Press Release
Agility Public Warehousing Co. KSC (Agility), a Kuwaiti company, has agreed to globally resolve criminal, civil, and administrative cases arising from allegations that Agility overcharged the United States when performing contracts with the Department of Defense (DOD) to supply food for U.S. troops from 2003 through 2010. As part of the global resolution, Agility has agreed to pay $95 million to resolve civil fraud claims, to forgo administrative claims against the United States seeking $249 million in additional payments under its military food contracts, and to plead guilty to a criminal misdemeanor offense for theft of government funds. DOD’s Defense Logistics Agency (DLA) will also release a claim of $27.9 million against Agility and lift its suspension of Agility, as the company has been suspended from federal government contracting for the last seven years after being indicted. An administrative agreement entered between DLA and Agility requires oversight of an Agility entity by an independent corporate monitor and the maintenance of an ethics and compliance program with a number of detailed requirements.
“The Department of Justice will hold accountable contractors that seek to profit unfairly at the expense of U.S. troops and taxpayers,” said Deputy Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “Those who expect to do business with the government must do so fairly and honestly, abiding by the contract terms to which they agreed.”
“Today’s global resolution represents a fair and just outcome of criminal, civil, and administrative cases that have been pending since 2009,” said U.S. Attorney John Horn for the Northern District of Georgia. “Agility has admitted to criminal conduct, has given up claims it valued at up to $249 million, and must pay $95 million to the government. The agreements require Agility to take responsibility for its criminal wrongdoing and take affirmative steps to prevent it from engaging in this conduct again, and the government recovers significant funds that were alleged to have been wrongly paid.”
“This settlement marks the conclusion of a lengthy investigation that demonstrates the Defense Criminal Investigative Service’s (DCIS) commitment to ensuring that tax dollars spent to support Department of Defense programs and missions are protected from fraud and abuse throughout the procurement process, but especially during overseas combat operations which are the most vulnerable,” said Special Agent in Charge John F. Khin of , DCIS-Southeast Field Office. “This extremely complex investigation required DCIS agents and our partners to tenaciously sort through and piece together an unprecedented volume of information and documents, and persevere through many years of exhaustive work, to bring this case to a resolution.”
“We are very pleased with this resolution, and are gratified that the public can now see what we’ve been aggressively investigating,” said Director Frank Robey of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit (MPFU). “Companies that do business with the government must comply with all of their obligations, and if they overcharge for supplying our men and women in uniform who are bravely serving this nation, they must be held accountable for their actions.”
“In simple terms, defense contractor based fraud is theft directly from the American people,” said Special Agent in Charge David J. LeValley of FBI Atlanta Field Office. “The FBI is pleased with the persistence and determination of its investigators, law enforcement partners, and federal prosecutors who saw this investigation through to its successful conclusion.”
The civil claims and criminal charges resolved today arise out of allegations originally raised in a civil whistleblower suit against Agility and another Kuwaiti company, The Sultan Center Food Products Company, K.S.C. (TSC). Kamal Mustafa Al-Sultan, a former vendor of Agility, filed the lawsuit under the qui tam, or whistleblower, provisions of the False Claims Act (FCA), which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The Act also allows the government to intervene and take over the action, as it did in this case. Mr. Al-Sultan will receive $38.85 million as a result of the civil action he filed, which is captioned U.S. ex rel. Kamal Mustafa Al-Sultan v. Agility Public Warehousing Co., K.S.C. et al., No 1:05-cv-2968-GET (N.D. Ga.).
In its civil complaint, the United States alleged that Agility and TSC knowingly overcharged the Department of Defense for locally available fresh fruits and vegetables that Agility purchased through TSC, and falsely charged the full amount of TSC’s invoices despite agreeing that Agility would pay 10 percent less than the amount billed. The United States also alleged that Agility failed to disclose and pass through rebates and discounts it obtained from U.S.-based suppliers, as required by its contracts.
The criminal Information to which Agility has agreed to plead guilty alleges conduct that was part of the pending indictment. Specifically, it alleges that in connection with one of its contracts, Agility concealed consolidation fees that should have been paid by Agility, plus an additional markup to the company, in the product price billed to the United States. As a result of Agility’s price manipulation, the United States paid an inflated price for food. The criminal Information to which Agility is pleading guilty charges Agility for one inflated invoice in an amount of less than $1,000, although the United States asserts that Agility engaged in this price manipulation whenever it used this consolidator.
Following Agility’s criminal Indictment by a grand jury, on Nov. 16, 2009, DLA suspended Agility from government contracting due to the criminal Indictment. This suspension was subsequently extended to Agility’s more than 300 affiliated entities. As a result, Agility and its affiliates have forgone the opportunity to obtain billions of dollars in revenue associated with DOD contracts since 2009. Although Agility’s suspension will be lifted, it will be required to use an independent monitor. Moreover, the agreement requires Agility to maintain an ethics and compliance program with a number of detailed requirements.
Since 2006, Agility has filed a number of contract claims seeking additional payments of $249 million alleging that DLA owed Agility payments for its performance under a series of military contracts, which DLA contested in protracted litigation. Today’s agreement requires Agility to release all claims against DLA related to the contracts.
The resolution of the criminal and civil matters in the U.S. District Court for the Northern District of Georgia were the result of a coordinated effort by the U.S. Attorney’s Office for the Northern District of Georgia and the Civil Division’s Commercial Litigation Branch. The claims resolved by the settlements are allegations only, except to the extent the conduct was admitted as part of the defendant’s guilty plea, and there has been no determination of liability.
The criminal and civil cases were investigated by the DCIS, U.S. Army’s Criminal Investigative Command’s MPFU, Defense Contract Audit Agency, and the FBI.
Defense Contractor Agility Resolves Criminal, Civil and Administrative Cases totaling Hundreds of Millions of DollarsRead the Press Release
ATLANTA – Agility Public Warehousing Co. KSC (Agility), a Kuwaiti company, has agreed to globally resolve criminal, civil, and administrative cases arising from allegations that Agility overcharged the United States when performing contracts with the Department of Defense (DOD) to supply food for U.S. troops from 2003 through 2010. As part of the global resolution, Agility has agreed to pay $95 million to resolve civil fraud claims, to forego administrative claims against the United States seeking $249 million in additional payments under its military food contracts, and to plead guilty to a criminal misdemeanor offense for theft of government funds. DOD’s Defense Logistics Agency (DLA) will also release a claim of $27.9 million against Agility and lift its suspension of Agility, as the company has been suspended from federal government contracting for the last seven years after being indicted. An administrative agreement entered between DLA and Agility requires oversight of an Agility entity by an independent corporate monitor and the maintenance of an ethics and compliance program with a number of detailed requirements.
“Today’s global resolution represents a fair and just outcome of criminal, civil, and administrative cases that have been pending since 2009,” said U.S. Attorney John Horn. “Agility has admitted to criminal conduct, has given up claims it valued at up to $249 million, and must pay $95 million to the government. The agreements require Agility to take responsibility for its criminal wrongdoing and take affirmative steps to prevent it from engaging in this conduct again, and the government recovers significant funds that were alleged to have been wrongly paid.”
“The Department of Justice will hold accountable contractors that seek to profit unfairly at the expense of U.S. troops and taxpayers,” said Deputy Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “Those who expect to do business with the government must do so fairly and honestly, abiding by the contract terms to which they agreed.”
“In simple terms, defense contractor based fraud is theft directly from the American people. The FBI is pleased with the persistence and determination of its investigators, law enforcement partners, and federal prosecutors who saw this investigation through to its successful conclusion,” said David J. LeValley, Special Agent in Charge, FBI Atlanta Field Office.
“This settlement marks the conclusion of a lengthy investigation that demonstrates the Defense Criminal Investigative Service's (DCIS) commitment to ensuring that tax dollars spent to support Department of Defense programs and missions are protected from fraud and abuse throughout the procurement process, but especially during overseas combat operations which are the most vulnerable,” said John F. Khin, Special Agent in Charge, DCIS-Southeast Field Office. “This extremely complex investigation required DCIS agents and our partners to tenaciously sort through and piece together an unprecedented volume of information and documents, and persevere through many years of exhaustive work, to bring this case to a resolution.”
“We are very pleased with this resolution, and are gratified that the public can now see what we've been aggressively investigating,” said Director Frank Robey of the U.S. Army Criminal Investigation Command's Major Procurement Fraud Unit (MPFU). “Companies that do business with the government must comply with all of their obligations, and if they overcharge for supplying our men and women in uniform who are bravely serving this nation, they must be held accountable for their actions.”
According to U.S. Attorney Horn, the charges and other information presented in court: the civil claims and criminal charges resolved today arise out of allegations originally raised in a civil whistleblower suit against Agility and another Kuwaiti company, The Sultan Center Food Products Company, K.S.C. (TSC). Kamal Mustafa Al-Sultan, a former vendor of Agility, filed the lawsuit under the qui tam, or whistleblower, provisions of the False Claims Act (FCA), which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The Act also allows the government to intervene and take over the action, as it did in this case.
In its civil complaint, the United States alleged that Agility and TSC knowingly overcharged the Department of Defense for locally available fresh fruits and vegetables that Agility purchased through TSC, and falsely charged the full amount of TSC’s invoices despite agreeing that Agility would pay 10 percent less than the amount billed. The United States also alleged that Agility failed to disclose and pass through rebates and discounts it obtained from U.S.-based suppliers, as required by its contracts.
The criminal information to which Agility has agreed to plead guilty alleges conduct that was part of the pending indictment. Specifically, it alleges that in connection with one of its contracts, Agility concealed consolidation fees that should have been paid by Agility, plus an additional markup to the company, in the product price billed to the United States. As a result of Agility’s price manipulation, the United States paid an inflated price for food. The criminal information to which Agility is pleading guilty charges Agility for one inflated invoice in an amount of less than $1,000, although the United States asserts that Agility engaged in this price manipulation whenever it used this consolidator.
Following Agility’s criminal indictment by a grand jury, on November 16, 2009, DLA suspended Agility from government contracting due to the criminal indictment. This suspension was subsequently extended to Agility’s more than 300 affiliated entities. As a result, Agility and its affiliates have foregone the opportunity to obtain billions of dollars in revenue associated with U.S. Department of Defense contracts since 2009. Although Agility’s suspension will be lifted, it will be required to use an independent monitor. Moreover, the agreement requires Agility to maintain an ethics and compliance program with a number of detailed requirements.
Since 2006, Agility has filed a number of contract claims seeking additional payments of $249 million alleging that DLA owed Agility payments for its performance under a series of military contracts, which DLA contested in protracted litigation. Today’s agreement requires Agility to release all claims against DLA related to the contracts.
The resolution of the criminal and civil matters in the U.S. District Court for the Northern District of Georgia were the result of a coordinated effort by the U.S. Attorney’s Office for the Northern District of Georgia and the Department of Justice’s Civil Division. The claims resolved by the settlements are allegations only, except to the extent the conduct was admitted as part of the defendant’s guilty plea, and there has been no determination of liability.
The criminal and civil cases were investigated by the DCIS, U.S. Army’s Criminal Investigative Command’s MPFU, Defense Contract Audit Agency, and the FBI.
Assistant U.S. Attorneys Steven D. Grimberg, Glenn D. Baker, Nathan P. Kitchens, and Kamal Ghali prosecuted the criminal case. Assistant U.S. Attorney Amy Berne prosecuted the civil case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Defendant Sentenced to 200 Months in Federal Prison on Methamphetamine Distribution ConvictionRead the Press Release
LUBBOCK, Texas — Rene Ortiz, of Lubbock, was sentenced today by Senior U.S. District Judge Sam R. Cummings to 200 months in federal prison on a methamphetamine distribution conviction, announced John Parker, U.S. Attorney for the Northern District of Texas.
Ortiz, 42, pleaded guilty in February 2017 to an indictment charging one count of possession with intent to distribute 50 grams or more of methamphetamine. He has been in custody since December 2016, after the return of that indictment.
Co-defendant Michael Sebastion Ford, 24, also of Lubbock, pleaded guilty in February 2017 to the same offense and is scheduled to be sentenced June 9, 2017.
According to documents filed in the case, on October 25, 2016, officers with the Lubbock County Sheriff’s Office, operating in an undercover capacity, called Ford and reached an agreement for Ford to sell the officers two ounces of methamphetamine for $1,300. The deal was scheduled to take place on October 26, 2016 at a residence located in Lubbock. The undercover officer arrived at the location and spoke with Ford who told the officer that his cousin would be bringing the methamphetamine later on. The undercover officer left the residence and told Ford to notify him when the drugs had arrived. Ford texted the officer a few moments later to tell the officer that the drugs had arrived at the residence. During this time, officers observed a vehicle arrive at the residence and saw Ford approach the front passenger side of the vehicle and talk to the driver. As officers approached the residence, Ford saw them and ducked down next to the vehicle before running into the residence where he was then arrested. Officers approached the vehicle and identified the driver as Ortiz. As Ortiz exited the vehicle, officers observed a bag containing approximately 10 grams of methamphetamine on the driver side floor mat. Officers also found a torn baggie underneath the vehicle that contained approximately 26 grams of methamphetamine and found another 30.4 grams of methamphetamine behind the driver seat. A pistol and ammunition were also found in a shoe box in the back of the vehicle.
An additional 880 grams of methamphetamine was located in the hotel room where Ortiz had been staying.
The Lubbock County Sheriff’s Office and U.S. Immigrations and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) investigated. Assistant U.S. Attorney Sean Long prosecuted.
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Cynthiana Man Found Guilty of Robbery Involving Lexington PharmacyRead the Press Release
LEXINGTON, Ky. – A Cynthiana, Ky., man has been convicted by a jury of federal charges related to the robbery of a Lexington Rite Aid.
On Thursday, a federal jury in Lexington found Miguel David Ayala, 38, guilty of pharmacy robbery and possession with intent to distribute hydrocodone pills. The jury returned the verdict after a three-day trial.
The evidence established that on July 8, 2015, Ayala robbed the Rite Aid Pharmacy on Executive Drive in Lexington. During the robbery, Ayala, who was armed with a handgun, stole approximately 4,000 hydrocodone pills.
The evidence also established that after the robbery, Ayala intended to distribute the stolen hydrocodone pills.
Carlton S. Shier, IV, Acting United States Attorney for the Eastern District of Kentucky; Timothy J. Plancon, Special Agent in Charge of the DEA Detroit Field Division; Mark G. Barnard, Chief of the Lexington Division of Police; and Ray Johnson, Chief of the Cynthiana Police Department, jointly made the announcement.
The investigation was conducted by the DEA, Lexington Police Department, and Cynthiana Police Department. Assistant U.S. Attorney Robert M. Duncan, Jr., prosecuted the case on behalf of the federal government.
Ayala is currently scheduled to appear for sentencing before Senior Judge Joseph M. Hood in Lexington, on August 28, 2017, at 11:30 a.m. Ayala faces a maximum prison sentence of 20 years. Any sentence, however, will be imposed by the court, after consideration of the United States Sentencing Guidelines and the federal statutes governing the imposition of sentences.
Columbia Man Sentenced for Threatening Lawyer in Drug-trafficking CaseRead the Press Release
JEFFERSON CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced that the father of a man convicted of leading a large-scale drug-trafficking conspiracy in Columbia, Mo., was sentenced in federal court today for threatening the attorney who represented one of his son’s co-defendants.
Bruce Wayne Stephens, 71, of Columbia, was sentenced by U.S. District Judge Roseann Ketchmark to eight years in federal prison without parole. Today’s federal sentence must be served consecutively to any probation revocation sentence imposed on Stephens in an unrelated state case for felony driving while suspended in Cooper County, Mo. Stephens has remained in federal custody since his arrest on Oct. 12, 2016.
On Dec. 7, 2016, Stephens was found guilty at trial of obstructing justice by threatening to retaliate against another person because of his participation in an official proceeding.
Stephens is the father of Malcolm Desean Redmon, who was sentenced on Sept. 29, 2016, to 24 years and four months in federal prison without parole. Redmon pleaded guilty to leading a conspiracy to distribute five kilograms or more of powder cocaine and crack cocaine in Boone County from November 2011 to August 2014. Court documents also cite Redmon’s involvement in numerous shooting incidents and his history of criminal activity, including violent crimes and drug use. Twenty seven defendants were convicted and have been sentenced in that case.
Evidence introduced during the trial indicated that Stephens made a series of threats intended to retaliate against those involved in the prosecution of Redmon. The primary person Stephens threatened was Brian Risley, the attorney who represented one of Redmon’s co-defendants, Vershawn Edwards.
While the case against him was pending, Redmon was involved in threatening witnesses and cooperators, as documented by recorded phone conversations between Redmon and his mother, as well as postings on various social media sites and documents obtained via search warrant that contained the names of individuals next to witness statements of persons Redmon believed were responsible for cooperating against him.
When Risley arrived at the federal courthouse for Edwards’s sentencing hearing on Sept. 29, 2016 (the same afternoon as Redmon’s sentencing hearing), he was met by several persons outside the courtroom who asked him who he represented. When he replied that he represented Edwards, Stephens repeatedly stated, “snitches, snitches belong in ditches.”
Inside the courtroom, Stephens again repeatedly stated the phrase, “snitches, snitches belong in ditches,” and this time appeared to direct the comments toward Edwards’s family members in the courtroom. After the Edwards sentencing hearing concluded, Stephens moved toward Edwards’s family in the courtroom. Risley, fearing that Stephens would attempt to confront family members, attempted to physically block Stephens’s access by placing himself between Stephens and the family. The family left the courtroom and Risley kept himself positioned between Stephens and the family as the family moved toward the elevator. During this time, Stephens was again repeating the phrase “snitches, snitches belong in ditches.”
Risley raised his arm at one point to prevent Stephens from passing him and Stephens then began to curse loudly and accused Risley of pushing him. Two court security officers then escorted Stephens out of the courthouse. One of the officers heard Stephens threaten Risley and the officers.
A few minutes later, Risley left the courthouse and walked to his car parked on the street across from the courthouse. Stephens then accosted Risley as Risley got to his car and opened the car door. Stephens stated to Risley, “snitches, you a … snitch … I will kill you, kill your wife, kill your family.” Risley did not respond, finished getting into his car, shut the car door and drove off.
While there is no direct evidence that Stephens participated in his son’s drug-trafficking conspiracy, according to court documents, there is ample evidence that Stephens supported Redmon’s drug-dealing lifestyle as well as the culture associated with drug dealing, one part of which is to threaten harm to those who testify against drug dealers. For example, in his post-arrest statement, Stephens reaffirmed his belief that physical harm should be inflicted on “snitches.” Stephens has incurred 34 separate criminal convictions since the age of 19 and served at least three stints in the Missouri state prison system.
In sentencing Stephens today, the court found that he committed perjury when he testified in his own defense at trial, which increased the advisory sentencing guidelines range from a maximum of six years and six months in prison to a maximum of eight years in prison. Stephens falsely testified, for example, that he did not make any threatening statements in the courtroom while attending the Edwards sentencing hearing. Stephens testified that he used foul and abusive language, but denied that he committed any crime. Stephens attempted to justify his use of foul and abusive language by falsely claiming that he did so only after Risley allegedly assaulted him, and after court security officers mistreated him by being indifferent both to the assault and to Stephens’s need to use the bathroom. Stephens also falsely testified that he did not make any threatening statements to Risley outside the courthouse. Stephens’s testimony included a false narrative of events that occurred in the courthouse, in the courtroom, after he was kicked out of the courthouse, and especially on the street outside the courthouse where Stephens threatened to kill Risley and his family.
This case was prosecuted by Deputy U.S. Attorney Gene Porter and Assistant U.S. Attorney Emily Orsinger. It was investigated by the FBI.
Columbia Man Sentenced for Robbing Police InformantRead the Press Release
Columbia, South Carolina---- United States Attorney Beth Drake stated today that Maurice Darnell Geter, a/k/a “Rease”, age 35, of Columbia, South Carolina, was sentenced in federal court in Columbia, South Carolina, for possession of a firearm during a violent crime or drug trafficking crime, a violation of 18 U.S.C. § 924(c). United States District Judge Mary Geiger Lewis of Columbia sentenced Geter to 262 months (21.8 years) incarceration followed by 5 years of supervised probation. Geter was also sentenced to 2 years’ incarceration for violation of a previous term of supervised probation. Both sentences to run concurrently.
Evidence presented at the change of plea hearing established that on January 26, 2015, the Columbia Police Department utilized a confidential informant to make a purchase of crack cocaine and a gun from Geter. The informant was given money to make the purchases from Geter. The informant called and arranged to meet Geter at a bus station. When the informant arrived, Geter got into the car and directed him to a residence.
When they arrived at the location, Geter exited the vehicle to get the gun. He returned a short time later with a gun that he gave to the informant without the gun magazine. When the informant asked Geter for the magazine, Geter initially refused. The informant also asked Geter for some crack cocaine. Geter gave him a small amount of crack and the informant asked for more but Geter did not bring it with him. The informant told Geter to call him when he got more crack and refused to buy the crack.After discussing the issue about the gun, Geter agreed to provide the magazine for the gun. Geter took the gun and exited the car again. When he returned, he had the gun and the magazine. Geter ejected one of the bullets from the gun and began to wipe off his fingerprints. The informant told Geter that he did not need to do this. Geter got anxious and yelled at the informant. Geter then racked the slide of the gun, pointed it at the informant, and told him that someone is going to get shot. Geter then demanded all of the informant’s money and attempted to take the informant’s cellphone. The informant refused to give Geter his cellphone. Geter got out of the car and continued to order the informant to give him his cellphone. When he refused, Geter walked away and left with the money and the gun.
The case was investigated by agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Columbia Police Department. Assistant United States Attorney William K. Witherspoon of the Columbia office prosecuted the case.
This case was prosecuted as part of the joint federal, state and local Project CeaseFire initiative, which aggressively prosecutes firearm cases.
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Child Predator Sentenced to 30 Years in Federal PrisonRead the Press Release
BATON ROUGE, LA – Acting United States Attorney Corey R. Amundson announced today that U.S. District Judge Shelly D. Dick sentenced JIMMY R. DAVIS, age 29, of Zachary, Louisiana, to serve thirty (30) years in federal prison following his convictions for distribution of child pornography and transferring obscene material to a minor. DAVIS was also ordered to make $9,000 in restitution payments to victims and will be required to serve a twenty (20) year term of supervised release upon his release from prison.
This criminal case began when Ventura County Sheriff’s Deputies in Ventura County, California, based on information received from the National Center for Missing and Exploited Children, executed a search warrant at a residence in California. Forensic examiners with the Southern California High Tech Task Force discovered that a fifteen (15) year-old child, Child Victim A, had received child pornography from an individual with the online profile “BoomBoomPow.” Forensic examination of Child Victim A’s electronic devices revealed that BoomBoomPow was twenty-seven (27) at the time, lived and worked in the Zachary/Baker area, had a specific anime-style tattoo, and frequented local Wal-Mart stores.
Baton Rouge FBI Agents began distributing photographs of the relevant tattoo to Zachary-area businesses, including Wal-Mart. After seeing the FBI photo, a Wal-Mart employee recognized the tattoo, informed the FBI, and discussed the situation with her co-workers. Days later, another employee saw a man (DAVIS) with a matching tattoo and contacted the Zachary Police Department. Zachary Police informed the FBI, and DAVIS was interviewed and arrested. Subsequent investigation revealed that the DAVIS had taken pornographic images of a very young child, Child Victim B, while she was lying in a crib, before distributing them to Child Victim A.
Acting U.S. Attorney Amundson stated, “Through his despicable actions, this defendant earned every minute of his 30-year prison sentence. Protecting our children from child predators will continue to be a top priority of this office. I highly commend those members of our community who helped to ensure that justice was done. We look forward to continuing to work with the public and our excellent federal, state, and local law enforcement partners to aggressively pursue those whose crimes involve the sexual exploitation of children.”
FBI New Orleans Special Agent-in-Charge (SAC) Jeffrey S. Sallet stated, “Safeguarding children is one of the FBI New Orleans Division’s highest priorities. We are committed to seeking out child predators and working with our federal, state, and local law enforcement partners to bring them to justice. This investigation and sentence demonstrates that commitment.”
The case was investigated by the Baton Rouge Office of the Federal Bureau of Investigation, the Ventura County Sheriff’s Office, and the Southern California High Tech Task Force, with substantial assistance from the Zachary Police Department. This case was prosecuted by Assistant U.S. Attorneys Ryan Crosswell and Chris Dippel, who serves as a Deputy Chief of the Criminal Division.
California Mother and Son Sentenced to Prison for Fraudulent Corporate Tax ReturnsRead the Press Release
San Francisco residents, Howard Hsu and his mother, Tracy Chang, were sentenced to prison today following their convictions on tax fraud charges, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Brian J. Stretch for the Northern District of California.
Hsu was ordered to serve 33 months in prison and Chang was ordered to serve 12 months and one day in prison. Hsu and Chang were found guilty following a one-week trial for conspiring to file fraudulent corporate income tax returns, filing false tax returns and aiding the preparation of false tax returns. According to the evidence presented at trial, Hsu, 36, owned and operated Didsee Corporation (Didsee), a business incorporated in Nevada, that provided advertisement-marketing services to online websites and marketplaces. Tracy Chang, 65, was Disdee’s bookkeeper and listed as the President, Secretary, Treasurer and Director. Chang opened bank accounts for the business, transferred money between accounts, and paid Didsee’s bills.
“Every taxpayer is required to file accurate returns and to pay their fair share,” said Acting Deputy Assistant Attorney General Goldberg. “Mr. Hsu ignored that responsibility, and with today’s prison sentence is held fully to account for deducting personal expenses as business expenses and filing false returns.”
“Today’s sentences are a cogent reminder to all business owners that the obligation to faithfully pay taxes amounts to more than a simple duty to be fair and honest,” said U.S. Attorney Stretch. “It is a legal obligation that, if flouted, can land you in prison.”
“We want everyone who files a tax return to take advantage of the deductions and credits to which they are entitled by law, however, no one is entitled to defraud the United States and the American taxpayers,” said Special Agent in Charge Michael T. Batdorf of IRS Criminal Investigation (CI). “After paying a large tax bill, Tracy Chang and her son, Howard Hsu endeavored to virtually eliminate any future tax due from their company, Didsee Corporation. Those who file accurate, honest and timely returns can be assured that the government will hold accountable those who don’t. IRS-CI and the Department of Justice will investigate and prosecute those who violate our tax system.”
Hsu and Chang conspired together to file fraudulent 2008 through 2009 corporate income tax returns, and an amended 2007 corporate tax return, cheating the IRS out of approximately $500,000. Hsu provided false summaries to Didsee’s return preparers, which claimed business expenses that were not incurred and included Hsu’s personal expenses. Chang signed the fraudulent returns as Didsee’s President.
In addition to the terms of imprisonment, Hsu and Chang were ordered to serve three years of supervised release and to pay $396,306 in restitution to the IRS and to pay a fine of $75,000 and $7,500, respectively.
Acting Deputy Assistant Attorney General Goldberg and U.S. Attorney Stretch thanked special agents of IRS-Criminal Investigation, who conducted the investigation and assisted the prosecution team at trial, and Assistant U.S. Attorney Colin Sampson and Trial Attorney Matthew J. Kluge of the Tax Division, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Brazilian National Charged with Illegal Reentry after DeportationRead the Press Release
BOSTON - A Brazilian national was charged yesterday in federal court in Boston with a federal immigration crime.
Daybson Pereira, 34, a Brazilian national residing in Boston, was charged with illegally reentering the United States after being deported.
According to the indictment, Pereira was deported in March 2009 after unlawfully entering the United States. In May 2017, federal agents in Boston discovered Pereira and determined him to be in the United States illegally.
The charge of illegal reentry after deportation provides for a sentence of no greater than two years in prison, one year of supervised release and a fine of $250,000. Pereira will be subject to deportation upon completion of his sentence. 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 Matthew J. Etre, Special Agent in Charge of Homeland Security Investigations in Boston, made the announcement today. Assistant U.S. Attorney Kenneth G. Shine of Weinreb’s Major Crimes Unit is prosecuting the case.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Boston Man Charged with Sex TraffickingRead the Press Release
BOSTON – A Boston man was charged Wednesday in federal court in Boston with sex trafficking.
Corey Smith, 35, was indicted on one count of transportation of a minor for purposes of prostitution, one count of sex trafficking by force, fraud or coercion, and two counts of transportation of an individual with intent to engage in prostitution.
According to the indictment, between January 2015 and March 2015, Smith transported a minor girl between Massachusetts, Georgia, and Connecticut, with the intent that she would engage in prostitution. Between November 2014 to June 2015, Smith transported another woman between Massachusetts, Georgia, and Connecticut with the intent that she would engage in prostitution, and used force and threats to coerce her to do so. Smith transported a third woman between Massachusetts and Connecticut with the intent that she would engage in prostitution between January and February 2015.
The charge of sex trafficking provides for a mandatory minimum sentence of 15 years and up to a lifetime in prison, five years of supervised release and a fine of $250,000. The charge of transportation of a minor for purposes of prostitution provides for a mandatory minimum sentence of 10 years and up to a lifetime in prison, five years of supervised release and a fine of $250,000. The charge of transportation for purposes of prostitution provides for a sentence of no greater than 10 years in prison, three years 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.
United States Attorney William D. Weinreb and Matthew J. Etre, Special Agent in Charge of Homeland Security Investigations in Boston, made the announcement. Assistant U.S. Attorney Miranda Hooker of Weinreb’s Civil Rights Enforcement Team is prosecuting the case.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Arkansas Man Pleads Guilty to Bomb Threats at Cedar County CourthouseRead the Press Release
SPRINGFIELD, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced today that an Arkansas man has pleaded guilty in federal court to making bomb threats to the Cedar County Courthouse in an effort to cancel his own court hearing that he feared would send him to jail.
Phillip Ray Robison, Jr., 36, of Hartford, Arkansas, pleaded guilty before U.S. District Judge M. Douglas Harpool on Thursday, May 25, 2017, to one count of maliciously conveying false information related to explosive materials. Robison remains in federal custody without bond.
By pleading guilty, Robison admitted that he made three separate bomb threats on two occasions in January 2016, each of which caused the evacuation of the Cedar County Courthouse in Stockton, Mo.
Robison called the court clerk for the Cedar County Courthouse on Jan. 11, 2016. Robison stated, “You better tell Judge Bickel to clear the courthouse cuz a bomb is going off at 2:30.” Law enforcement cleared everyone and searched the courthouse for the presence of an explosive or bomb. Law enforcement did not locate an explosive device in the courthouse.
After the courthouse was cleared, Robison called the clerk’s office a second time and said, “you screwed up,” indicating that law enforcement had missed the bomb during their original search. Once again the courthouse was closed and another search was conducted. Law enforcement again failed to find an explosive device during this second search.
On the day of the bomb threat, a court bailiff observed Robison at the courthouse. The bailiff thought that Robison seemed nervous. Robison had been scheduled to appear in Judge Bickel’s court for a probation violation hearing following his prior conviction for distribution of illegal narcotics. Robison was concerned that he was going to be sent to the Missouri Department of Corrections for a 120-day sentence.
On Jan. 25, 2016, Robison called another bomb threat into the Cedar County Courthouse. The court was cleared and searched by law enforcement officers. No explosive device was located. When the court reopened to the public, Robison was first in line. Deputies who were aware of the circumstances of the first bomb threat recognized Robison.
Deputies asked Robison to step out of line to speak with them. Robison agreed to be interviewed and was taken to the sheriff’s office. Robison admitted that he had made both of the January 2016 bomb threats because he wanted his court hearing to be cancelled. Robison believed that if his hearing was held, the court would return him to jail, and he wanted to avoid returning to jail. Robison also told deputies that there were never any bombs.
Under federal statutes, Robison is subject to a sentence of up to 10 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the Cedar County, Mo., Sheriff’s Department and the FBI.
Arizona Man Arrested for Assaulting Federal Officers and Mailing Threatening Communications in New MexicoRead the Press Release
ALBUQUERQUE – Brian Clayton Charles, 49, of Tucson, Ariz., made his initial appearance yesterday in the U.S. District Court for the District of Arizona on a criminal complaint filed in the U.S. District Court for the District of New Mexico that charges him with assaulting a federal law enforcement officer and mailing threatening communications,
Charles was arrested in Tucson on May 24, 2017, on a criminal complaint alleging that he retaliated against a federal law enforcement official by sending threatening mail to the personal residence of an officer of the Albuquerque Police Department (APD) who is commissioned as a Special Federal Officer by the U.S. Marshals Service. The criminal complaint also charges Charles with mailing threatening communications to five other APD officers in Sept. 2016 and Oct. 2016.
According to the criminal complaint, the Diplomatic Security Service of the U.S. Department of State initiated an investigation into Charles after he allegedly mailed a letter, which was postmarked March 24, 2016, to the home address of then Secretary of State John Kerry in Washington D.C., which threatened to harm the Secretary of State. The complaint alleges that Charles previously had mailed threatening communications to numerous other federal government officials in addition to communications threatening APD officers.
During yesterday’s proceedings in Tucson, waived his right to a detention hearing and remains in custody pending transfer to New Mexico to face the criminal charges against him.
If convicted of the charges in the criminal complaint, Charles faces the following statutory maximum penalties: six years in prison for retaliating against a federal law enforcement official; five years in prison on each count of the five counts for mailing threatening communications; and ten years in prison for assaulting a federal officer. Charges in criminal complaints are merely accusations. All criminal defendants are presumed innocent unless proven guilty beyond a reasonable doubt.
This case was investigated by the U.S. Department of State, Diplomatic Security Service and the Environmental Protection Agency, Office of Inspector General with assistance from APD. Assistant U.S. Attorney Paul H. Spiers is prosecuting the case.
Alien Sentenced for Receiving Child PornographyRead the Press Release
Acting United States Attorney Robert C. Stuart announced that Jose Manuel Garcia Vargas, 41, was sentenced in federal court in Omaha on May 26, 2017, for receiving child pornography. The Honorable Robert F. Rossiter, Jr. sentenced Garcia Vargas to five years of imprisonment. There is no parole in the federal system. After his release from prison, he will be deported to Mexico. Should he return to the United States, he will be subject to a 10-year term of supervised release and required to register as a sex offender.
A search warrant was executed on Garcia Vargas’s home on February 16, 2016. He admitted to receiving child pornography during Skype chats. He admitted to soliciting images from young girls and requesting that they be sexually explicit. A forensic review of his computers confirmed the Skype chats. Although no child pornography was recovered from the computer, one image of child pornography had been intercepted by his internet service provider.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorney’s Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Federal Bureau of Investigation.
Acting U.S. Attorney Reaches Agreement with Architecture Firm over Failure to Ensure Accessibility in Manhattan Apartment ComplexRead the Press Release
Joon H. Kim, Acting United States Attorney for the Southern District of New York, announced that the United States has settled a federal civil rights lawsuit against SLCE ARCHITECTS, LLP (“SLCE”), by consent decree. The suit alleges that SLCE violated the federal Fair Housing Act (“FHA”) by failing to design the Verdesian Apartments (“The Verdesian”), a Manhattan residential apartment complex, with the features required by the FHA to ensure accessibility for persons with disabilities.
Under the settlement, SLCE agrees to establish procedures, including the appointment of a Coordinator for Accessibility Education, to ensure that its ongoing and future development projects will comply with the accessibility requirements of the federal Fair Housing Act (“FHA”). Further, as part of the consent decree, SLCE has agreed to provide up to $15,000 to compensate aggrieved persons and to pay a civil penalty of $30,000. The consent decree was entered on May 24, 2017, by U.S. District Judge Jed S. Rakoff.
The developer of The Verdesian, Albanese Organization, Inc., and three of its affiliates, North End Associates, LLC, River Terrace Associates, LLC, and Chelsea Associates, LLC (together, the “Developer Defendants”), were also named as defendants in the suit, and Judge Rakoff approved a consent decree between the Government and the Developer Defendants on February 12, 2017, under which the Developer Defendants, among other remedial measures, agreed to make retrofits to The Verdesian.
Acting U.S. Attorney Joon H. Kim said: “Through this lawsuit, the Office continues its efforts to require not only developers, but also architects, to comply with the law by creating rental properties that are accessible to New Yorkers with disabilities. This settlement ensures that future projects designed by SLCE will comply with the FHA and can be fully enjoyed by individuals with disabilities.”
The FHA’s accessible design and construction provisions require new multifamily housing complexes constructed after January 1993 to have basic features accessible to persons with disabilities. According to the allegations in the Complaint, The Verdesian, a rental complex located at 211 North End with 253 rental units, was designed and constructed with numerous inaccessible features, including excessively high thresholds interfering with accessible routes in the public and common areas as well as into and within individual units, and insufficient widths, clearance, and clear floor space in bedrooms, bathrooms, closets, and kitchens for maneuvering by people who use wheelchairs.
To ensure future FHA compliance, the settlement requires SLCE to certify its plans, drawings, and blueprints as adhering to the requirements of the FHA and to institute policies and training to ensure that its employees and agents will comply with the FHA’s accessibility requirements.
Finally, the settlement requires SLCE to pay a civil penalty of $30,000 and to provide up to $15,000 to compensate aggrieved persons.
Aggrieved individuals may be entitled to monetary compensation from the fund created through the settlement. Aggrieved individuals may include those who:
- Were discouraged from living at The Verdesian because of the lack of accessible features;
- Have been hurt in any way by the lack of accessible features at The Verdesian;
- Paid to have an apartment at The Verdesian made more accessible to persons with disabilities; or
- Otherwise were discriminated against on the basis of disability at The Verdesian as a result of the inaccessible design and construction of the properties.
People who may be entitled to compensation should file a claim by contacting the Civil Rights Complaint Line at (212) 637-0840, using the Civil Rights Complaint Form available on the United States Attorney’s Office’s website http://www.justice.gov/usao/nys/civilrights.html, or by sending a written claim to:
U.S. Attorney’s Office, Southern District of New York
86 Chambers Street, 3rd Floor
New York, New York 10007
Attention: Chief, Civil Rights Unit
The case is being handled by the Office’s Civil Rights Unit. Assistant U.S. Attorneys Natasha W. Teleanu, Lauren Almquist Lively, Li Yu, and Jacob Lillywhite are in charge of the case.
Abington Memorial Hospital to Pay $491,672 to Settle False Claims Act Liability for Improper Medicare Reimbursement SubmissionsRead the Press Release
Acting United States Attorney Louis D. Lappen announced that Abington Memorial Hospital, which does business as Abington Hospital – Jefferson Health (AMH), has agreed to pay the United States $491,672, to resolve allegations that an AMH employee forged physician signatures on forms submitted to the Medicare program for home care services. These forms required physicians’ genuine signatures for such claims to be reimbursed by Medicare.
In June 2016, AMH disclosed to the Government its discovery that during a period beginning in May 2014, AMH’s affiliated home care agency, Jefferson Abington Health Home Care and Hospice, had submitted claim forms on which an AMH employee had improperly cut-and-pasted the required physician signatures. Accordingly, there was no legitimate physician authorization on these forms.
In addition to reporting the conduct to the Government, AMH promptly reversed any claims to Medicare that were within one year of billing and repaid the money received in reimbursement for those claims. AMH has also taken corrective measures to prevent such conduct from recurring. These measures include terminating the employee responsible and installing a computer program that requires physicians’ electronic signatures, eliminating the need for AMH to obtain physical signatures.
“Medicare beneficiaries are entitled to receive care that is determined by their clinical needs, and if health providers wish to be reimbursed with taxpayer funds, they must follow the rules and ensure that the services they provided were properly authorized and documented,” said Acting U.S. Attorney Lappen. “We commend Abington Memorial Hospital for coming forward to disclose its problems and for working to improve its practices to ensure compliance by all personnel.”
The case was handled by Assistant United States Attorneys Paul W. Kaufman and Mark J. Sherer
Thursday 25 May 2017
Wise, Virginia Man Sentenced for Taking Ginseng from National ForestRead the Press Release
Abingdon, VIRGINIA – A Wise man, who illegally removed Ginseng plants from the National Forest, was sentenced today in the United States District Court, Acting United States Attorney Rick A. Mountcastle announced.
Mark Evan Buchanan, 47, of Wise, Va., was sentenced today to two years of probation. He was ordered to pay $3,690 in restitution. Buchanan previously pled guilty to one count of attempting to transport, sell, receive or acquire plants in interstate commerce knowing that said plants were taken in an unlawful manner.
According to evidence presented in court by Special Assistant United States Attorney Kathleen Carnell, Buchanan possessed 246 wild Ginseng roots from the George Washington and Jefferson National Forrest knowing that it was illegal to take, possess, acquire and transport wild Ginseng from the National Forest. Buchanan intended to sell the Ginseng roots.
The investigation of the case was conducted by Special Agent James Willett of the U.S. Forest Service. Assistant United States Attorney Special Assistant United States Attorney Kathleen Carnell prosecuted the case for the United States.
Wichita Man Sentenced for Turning Stolen Mail into False IdentitiesRead the Press Release
WICHITA, KAN. - A Wichita man was sentenced Thursday to 46 months in federal prison for turning stolen mail into 14 false identities, U.S. Attorney Tom Beall said.
Jeremy Peterson, 43, Wichita, pleaded guilty to one count of conspiracy to produce false identification documents. In his plea, he admitted that other conspirators provided him with stolen mail he used to produce counterfeit documents including driver’s licenses and state identification cards. He produced documents for 14 stolen identities that conspirators used to buy cars. Local auto dealers suffered an actual loss of more than $218,000 as a result.
Peterson was one of 13 defendants charged last year in USA v Below, an indictment alleging they took part in a $3.5 million fraud scheme.
Beall commended the U.S. Postal Inspection Service, the Sedgwick County Sheriff’s Department, the Wichita Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives and Assistant U.S. Attorney Alan Metzger for their work on the case.
Wheeling man convicted of illegal possession of a firearmRead the Press Release
WHEELING, WEST VIRGINIA – A Wheeling, West Virginia man was convicted today of illegally possessing a firearm, Acting United States Attorney Betsy Steinfeld Jividen announced.
Christopher Louis Park, age 45, pled guilty to one count of “Unlawful Possession of a Firearm.” Park, who had previously been convicted of possession and distribution of cocaine in federal court in April 1999, admitted to possessing a .9mm caliber pistol. The crime occurred in Wheeling in January 2017.
Park faces up to ten years incarceration and a $250,000 fine. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendants.
Assistant U.S. Attorney Randolph J. Bernard prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated.
Senior U.S. District Judge Frederick P. Stamp, Jr. presided.
Waterbury Man Sentenced to 6 Years in Prison for Distributing Heroin Involved in Fatal OverdoseRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that JAMES HAYES, also known as “T.Y.,” 33, of Waterbury, was sentenced yesterday by U.S. District Judge Vanessa L. Bryant in Hartford to 72 months of imprisonment, followed by five years of supervised release, for distributing heroin that contributed to the overdose death of a Monroe woman last year. This matter stems from an ongoing statewide initiative targeting narcotics dealers who distribute heroin, fentanyl or opioids that cause death or serious injury to users.
According to court documents and statements made in court, on June 16, 2016, Monroe Police and emergency medical personnel responded to a residence in Monroe on report of a possible heroin overdose and found an unresponsive 32-year-old female on the floor of her bedroom. The victim was pronounced deceased shortly thereafter. Investigators seized various items that were located in the bedroom, including several empty wax folds and one wax fold that contained suspected heroin. The investigation revealed that HAYES distributed heroin that was consumed by the victim shortly before her death.
HAYES has been detained since his arrest on August 22, 2016. On January 20, 2017, he pleaded guilty to one count of distribution of heroin.
Judge Bryant ordered HAYES to forfeit $710 in cash seized from him at the time of his arrest.
This matter was investigated by the Drug Enforcement Administration’s New Haven Tactical Diversion Squad, Monroe Police Department and Waterbury Police Department. The case was prosecuted by Assistant U.S. Attorney Robert M. Spector.
Virginia Man Indicted for Possessing More than a Pound of CocaineRead the Press Release
BIRMINGHAM – A federal grand jury today indicted a Virginia man for possessing with intent to distribute more than a pound of cocaine in Greene County, announced Acting U.S. Attorney Robert O. Posey and Drug Enforcement Administration Assistant Special Agent in Charge Bret Hamilton.
A one-count indictment filed in U.S. District Court charges WILLIAM RONDELL HOLMES, 35, of Chesapeake, Va., with possessing the 500 grams or more of cocaine on Jan. 23.
The cocaine was discovered after an Alabama State Trooper stopped Holmes for speeding on Interstate 59.
The penalty for possession with intent to distribute 500 grams or more of cocaine is five to 40 years in prison and a maximum $5 million fine.
DEA investigated the case in conjunction with the Alabama Law Enforcement Agency. Assistant U.S. Attorney Austin Shutt is prosecuting the case.
An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.
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USAO-EDNC Celebrates National Drug Court MonthRead the Press Release
RALEIGH – In celebration of National Drug Court Month, the United States Attorney’s Office in the Eastern District of North Carolina (EDNC) spotlights the two Federal Drug Courts that operate in the EDNC. The H.O.P.E. Program, (Helping Offenders Pursue Excellence), began 2009 and is held in Raleigh, North Carolina. The S.T.A.R. Program, (Striving to Achieve Recovery), began in 2016 and is held in Greenville, North Carolina.
Both courts involve a collaborative effort between the EDNC’s U.S. District Court, U.S. Probation Office, U.S. Attorney’s Office, Federal Public Defender’s Office, and other agencies that provide rehabilitative services to former federal inmates with substance abuse issues, such as First Step Services and East Coast Counseling. These courts provide participants with a system of support through a range of incentives and sanctions aimed at promoting and targeting long-term, sustainable, positive change. A major goal of these drug reentry courts is to enable participants to manage and overcome their substance abuse issues using the tools provided to them during their participation in the court. These tools will help them to be successful on supervision and afterward.
National Drug Court Month is coordinated by the National Association of Drug Court Professionals (NADCP). Today, nearly 3,200 treatment courts are in operation in all 50 states, plus US territories, successfully treating close to 150,000 substance-addicted individuals each year.
Individuals on federal pretrial or supervised release interested in either of these programs should contact their supervising probation officer. For more information about the H.O.P.E. Program or the S.T.A.R. Program, contact Senior U.S. Probation Officer Julie Rosa at (919)861-8660.
U.S. Files 9 Lawsuits Seeking Forfeiture of Properties Worth over $30 Million Allegedly Bought with Proceeds of EB-5 Visa Fraud SchemeRead the Press Release
LOS ANGELES – Federal Prosecutors have filed nine civil complaints that seek the forfeiture of nine real properties across Southern California that were allegedly purchased with proceeds generated by a fraudulent scheme that collected more than $50 million from foreign investors seeking “Green Cards” through the EB-5 visa program.
The nine lawsuits filed yesterday afternoon in United States District Court allege that much of the money collected from the primarily Chinese investors either was refunded to the foreign nationals or was stolen by participants in the scheme.
The asset forfeiture complaints allege that attorney Victoria Chan and her father, Tat Chan, operated a business called California Investment Immigration Fund, LLC (CIIF) from 2008 until this year. In April, authorities executed federal search warrants as part of an ongoing investigation.
According to the lawsuits filed yesterday, CIIF exploited the EB-5 visa program, which provides lawful permanent residence – commonly known as a “Green Card” – to foreign nationals who invest at least $500,000 in a domestic business that creates 10 new American jobs. Those involved in the scheme allegedly convinced more than 100 Chinese nationals to invest over $50 million in CIIF and related companies.
“Rather than legitimately investing the funds into American businesses, CIIF either refunded the funds to the EB-5 investors while the investors’ EB-5 petitions were pending, in direct violation of the EB-5 program, or stole millions of dollars to use for personal expenditures, including buying million-dollar homes,” according to the lawsuits that allege “many foreign nationals were able to improperly obtain U.S. green cards.”
The lawsuits allege that the properties named in the asset forfeiture lawsuits were purchased with proceeds derived from mail fraud, wire fraud or visa fraud and that the purchases themselves constituted money laundering.
The lawsuits seek the forfeiture of nine properties:
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a commercial property in the City of Industry valued at over $3 million;
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five residences in the cities of Rancho Cucamonga, Arcadia (worth approximately $4 million), Diamond Bar, Riverside and Duarte (valued at $5.5 million); and
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parcels of land located in Ontario, Indio (worth nearly $6 million) and Rancho Cucamonga (valued at more than $7.7 million).
The asset forfeiture lawsuits contain allegations only. In order to forfeit the properties named in the complaints, the government must show by a preponderance of the evidence that the properties were purchased with proceeds derived from criminal activity.
The ongoing investigation into the EB-5 fraud scheme is being conducted by the FBI and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.
The asset forfeiture complaints were filed by Assistant United States Attorney Jonathan Galatzan of the Asset Forfeiture Section.
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Two men convicted of mail fraudRead the Press Release
CLARKSBURG, WEST VIRGINIA – Two West Virginia men pled guilty today to mail fraud, Acting United States Attorney Betsy Steinfeld Jividen announced.
Dallas Lewis, age 55, of Clarksburg, pled guilty to one count of “Conspiracy to Commit Mail Fraud.” Lewis admitted to conspiring with others to file false insurance claims from staged motor vehicle accidents. Lewis would then receive a portion of the insurance settlement in each filing. The crimes happened between January 2012 and August 2014 in Taylor, Harrison, and Marion Counties.
Charles Bonner, age 34, of Morgantown, pled guilty to one count of “Mail Fraud.” Bonner admitted to taking part in a staged vehicular accident in January 2012 in Harrison County. He also admitted to faking injuries from said accident and filing a false insurance claim, from which he, and others, received insurance settlements of approximately $101,500. Bonner also admitted his role in procuring an insurance settlement check in someone else’s name in the amount of $46,500.
Lewis and Bonner each face up to twenty years incarceration and a $250,000 fine. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendants.
Assistant U.S. Attorney Andrew R. Cogar prosecuted the case on behalf of the government. The West Virginia Insurance Commission Office of Inspector General and the United States Postal Inspection Service investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Two Gang Members Charged with Murder of A Bronx ManRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and James P. O’Neill, the Commissioner of the New York City Police Department (“NYPD”), announced today the indictment of two former members of the BSM gang, PARIS SOTO, a/k/a “P,” and “JOSEPH DENFIELD,” a/k/a “Denfield Joseph,” a/k/a “Denny,” for the gang-related murder of Donnell Harris on August 31, 2010. The case has been assigned to United States District Judge Victor Marrero. DENFIELD was presented yesterday before Magistrate Judge Ronald L. Ellis; SOTO is currently in state custody.
As alleged in the Indictment[1]:
BSM, which stands for “Brim Stone Mafia,” and later “Blood Stone Mafia,” was a criminal enterprise that operated mainly in and around the Bronx, New York, including in the vicinity of East 173rd Street and Topping Avenue. Members and associates of BSM engaged in the sale of narcotics, robberies, credit card fraud, and murder.
On August 31, 2010, BSM members SOTO and DENFIELD participated in the murder of Donnell Harris in order to maintain and increase their standing within BSM.
SOTO and DENFIELD are each charged with one count of murder in aid of a racketeering conspiracy, which carries a maximum sentence of death, or life in prison. The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants would be determined by the judge.
Mr. Kim praised the outstanding investigative work of the FBI and the NYPD.
This case is being handled by the Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Jessica Feinstein, Michael Gerber, and Hadassa Waxman are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Twenty-One Additional Defendants Indicted for Their Roles in Thai Sex Trafficking EnterpriseRead the Press Release
Tens of millions of dollars in illicit sex trafficking proceeds laundered and smuggled by criminal organization
Coordinated takedown results in 20 arrests, recovery of victims from active houses of prostitution, seizures of hundreds of thousands of dollars in cash and numerous weapons
SAINT PAUL – A superseding indictment unsealed earlier today in Saint Paul, Minn., charges twenty-one members of an international sex trafficking ring for their roles in the organization. The eight count superseding indictment outlines sex trafficking and money laundering offenses stemming from a criminal enterprise that, through the use of overwhelming bondage debt, force, threats of force, fraud, and coercion, trafficked women from Thailand to cities across the United States.
All of the charged defendants acted at high levels in the sophisticated criminal enterprise, which include 10 Thai nationals and 11 U.S. citizens. Twenty of the twenty-one charged defendants were arrested yesterday at various locations in Los Angeles, San Diego, Dallas, Austin, Houston, and Chicago. One defendant remains at large. During the coordinated takedown, law enforcement seized hundreds of thousands of dollars in cash, cell phones and condoms as well as multiple weapons.
The announcement was made by Acting U.S. Attorney Gregory G. Brooker of the District of Minnesota, Special Agent in Charge Alex Khu of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) St. Paul Division, Special Agent in Charge Shea Jones of the Internal Revenue Service (IRS) Criminal Investigation Division’s St. Paul Field Office, and Cook County (Illinois) Sheriff Thomas J. Dart.
“This indictment outlines charges against twenty-one members of a multi-million dollar, modern day organized crime operation. This is a highly complex case that required years of hard work, steadfast determination and dedication to bring these defendants to justice and provide hope to the hundreds of victims,” said Acting United States Attorney Gregory Brooker. “With the cooperation and coordination of our law enforcement partners and the various resources they all bring to bear, we were able to significantly disrupt and dismantle this criminal organization from all angles.”
“HSI fully utilizes our authorities and resources to address the immediate needs of victims, as well as targeting the organizations victimizing them,” said Special Agent in Charge Alex Khu of HSI St. Paul. “These arrests, achieved through interagency cooperation, are a testament to our combined resolve to dismantling this organization and preventing future harm to potential victims of this heinous crime.”
“I’m proud of the comprehensive efforts that went into this investigation by my office and each of the agencies that participated,” said Cook County Sheriff Thomas J. Dart. “The complexities of this organization represent the lengths to which criminals will go to profit off of human beings. This is an important reminder that sex trafficking and the associated buying, are not victimless crimes – this organization preyed and profited on vulnerable women. I am grateful that justice will be served.”
St. Paul Police Chief Todd Axtell said, “This operation sends a strong message to those who benefit financially from the exploitation of women. Your operations are not welcome here. If you engage in human trafficking, we will combine the public’s resources to find you, arrest you and ensure that you are not be allowed to retain your ill-gotten financial gains.”
“The special agents of IRS Criminal Investigation are committed to taking the profit away from these human traffickers,” stated Special Agent in Charge Shea Jones of the St. Paul Field Office IRS Criminal Investigation. “Today’s indictment sends a clear message that this activity will not be tolerated in our communities. As all financial transactions leave a trail, IRS Criminal Investigation special agents used their accounting expertise to analyze the complex financial transactions made by these criminals. Today’s indictment is a reminder that IRS Criminal Investigation is committed to following the money trail across the globe.”
According to the superseding indictment, which was returned under seal on May 16, 2017, from January 2009 through May 2017, the sophisticated criminal organization trafficked hundreds of women from Bangkok, Thailand, to various cities across the United States, including Minneapolis, Los Angeles, Chicago, Atlanta, Phoenix, Washington, D.C., Las Vegas, Houston, Dallas, Seattle, and Austin. Once in the United States, the victims were placed in houses of prostitution where they were forced to work long hours – often all day, every day – having sex with strangers. The victims were isolated from the outside world; they often had no freedom of movement and were not allowed to leave the prostitution houses unless accompanied by a member of the criminal organization.
According to the superseding indictment, the victims, who were often from impoverished backgrounds and spoke little English, were promised access to a better life in the United States, in exchange for an exorbitant “bondage debt” of between $40,000 and $60,000. Before being transported to the United States, the organization would typically arrange to have professional-quality escort-style photographs taken of the victims, which would ultimately be sent to traffickers in the United States and used to advertise the victims for sex on websites like backpage.com and eros.com. The organization also encouraged victims to have breast implants in Thailand to make the victims “more appealing” to potential sex buyers in the United States. The cost of the cosmetic surgery was added to the victims’ already significant bondage debts.
According to the superseding indictment, the organization engaged in widespread visa fraud to facilitate the international transportation of the victims. Traffickers assisted the victims in obtaining fraudulent visas and travel documents by funding false bank accounts, creating fictitious backgrounds and occupations, and instructing the victims to enter into fraudulent marriages to increase the likelihood that their visa applications would be approved. Traffickers also coached the victims as to what to say during their visa interviews. While working to obtain visa documents, traffickers gathered personal information from the victims, including the location of the victims’ families in Thailand. This information was later used to threaten victims who became non-compliant or tried to flee the organization in the United States.
According to the superseding indictment, the defendants held various roles in the organization including traffickers, house bosses, money launderers, and facilitators. It was common for a member of the conspiracy to hold more than one role, over time or simultaneously, in order to maximize profits. The traffickers were the individuals who held the bondage debt of a victim until it was fully repaid or, in some instances, a victim’s bondage debt would be sold from one trafficker to another. The house bosses were the individuals who “owned” the houses of prostitution and ran the day-to-day operations at the house. The money launderers were responsible for the successful and continued operation of the enterprise by making bank accounts available, coordinating deposits and withdrawals of cash as well as the movement of money in and back to Thailand. The organization’s facilitators assisted with all manner of needs including renting prostitution houses, facilitating the transport of victims, assisting with money laundering and entering into fraudulent marriages with members of the conspiracy so those members could gain immigration status in the United States.
According to the superseding indictment, the organization dealt primarily in cash and engaged in rampant and sophisticated money laundering in order to promote, redistribute and conceal illegal profits. The organization used “funnel accounts” to launder and route cash from cities across the U.S. to the money launderers in Los Angeles. Upon entry to the U.S., victims were often escorted by a member of the organization to a bank and instructed to open an account in her own name; once the account was open a member of the organization took control of the account and then provide the account information to other co-conspirators to coordinate deposits throughout the United States.
According to the superseding indictment, the organization also engaged in bulk cash smuggling by physically transporting and mailing illegal sex trafficking proceeds to Thailand. The money launderers recruited other individuals to carry large volumes of cash on their person when traveling to Thailand as well as hide cash in items such as clothing and dolls. The organization used a hawala system, a method in which financial transactions are based on trust and family association, to transfer money to Thailand and elsewhere outside the United States. The result is the movement of funds from one location to another without the need to actually transfer or wire the funds. The criminal organization moved tens of millions of dollars in illegal proceeds from the United States to Thailand and elsewhere using this hawala-based system.
This indictment relates to the case United States v. Intarathong, et al., 16-cr-257 (DWF/TNL). To date, three of seventeen defendants in that matter have pleaded guilty.
This case is the result of an investigation conducted by Homeland Security Investigations, Criminal Investigation Division of the IRS, Diplomatic Security Service, International Organized Crime Intelligence and Operations Center, St. Paul Police Department, and the Anoka County Sheriff’s Office, with assistance from the Cook County (Illinois) Sheriff’s Office and the Cook County Human Trafficking Task Force. We also want to acknowledge the support and assistance of United States Attorney’s Offices and law enforcement from across the country who came together to assist in executing a one-day, nationwide takedown of this international criminal organization.
The District of Minnesota is one of six districts designated through a competitive, nationwide selection process as a Phase II Anti-Trafficking Coordination Team (ACTeam), through the interagency ACTeam Initiative of the Departments of Justice, Homeland Security and Labor. ACTeams focus on developing high-impact human trafficking investigations and prosecutions involving forced labor, international sex trafficking and sex trafficking by force, fraud or coercion through interagency collaboration among federal prosecutors and federal investigative agencies. Today’s charges represent our continued ACTeam mission—to take on and take down the most entrenched and sophisticated human trafficking organizations that would attempt to profit from human misery.
Assistant U.S. Attorneys Laura M. Provinzino, Melinda A. Williams and Julie E. Allyn are prosecuting the case with the assistance of the Money Laundering and Asset Recovery section of the Criminal Division of the Department of Justice, the DOJ Office of International Affairs, and the DOJ Civil Rights Division’s Human Trafficking Prosecution Unit.
Defendant Information:
MICHAEL MORRIS, 63
Seal Beach, Calif.
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Sex trafficking by use of force, fraud, and coercion, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
CHATARAK TAUFFLIEB, 51
San Jose, Calif.
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Sex trafficking by use of force, fraud, and coercion, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
PEERACHET THIPBOONNGAM, 57
Los Angeles, Calif.
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
- Unlicensed money transmitting business, 1 count
PAWINEE UNPRADIT, 44
Dallas, Texas
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
SAOWAPHA THINRAM, 43
Hutto, Texas
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
GREGORY ALLEN KIMMY, 36
Hutto, Texas
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
WILAIWAN PHIMKHALEE, 38
Chicago, Ill.
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
KANYARAT CHAIWIRAT, 50
Chicago, Ill.
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
PORNTHEP SUKPRASERT, 40
Huntington Beach, Calif.
Charges:
- Conspiracy to engage in money laundering, 1 count
- Unlicensed money transmitting business, 1 count
MULCHULEE CHALERMSAKULRAT, 39
Huntington Beach, Calif.
Charges:
- Conspiracy to engage in money laundering, 1 count
BHUNNA WIN, 49
San Diego, Calif.
Charges:
- Conspiracy to engage in money laundering, 1 count
NATCHANOK YUVASUTA, 50
Los Angeles, Calif.
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Unlicensed money transmitting business, 1 count
NATTAYA LEELARUNGRAYAB, 45
Los Angeles, Calif.
Charges:
- Conspiracy to engage in money laundering, 1 count
VEERAPON GHETTALAE, 55
Lake Elsinore, Calif.
Charges:
- Conspiracy to engage in money laundering, 1 count
THOUCHARIN RUTTANAMONGKONGUL, 34
Chicago, Ill.
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
MATTHEW MINTZ, 25
Chicago, Ill.
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
MOHIT TANDON, 37
Burr Ridge, Ill.
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
RICHARD ALEXANDER, 52
DeKalb, Ill.
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
WARALEE WANLESS, 38
The Colony, Texas
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
TANAKRON PATRATH, 58
Houston, Texas
Charges:
- Conspiracy to commit sex trafficking, 1 count
- Conspiracy to commit transportation to engage in prostitution, 1 count
- Conspiracy to engage in money laundering, 1 count
- Conspiracy to use a communication facility to promote prostitution, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the superseding indictment are merely accusations, and the defendants are presumed not guilty unless and until proven guilty.
Three Nigerians Sentenced in International Cyber Financial Fraud SchemeRead the Press Release
Three Nigerian nationals, who were extradited from South Africa to the Southern District of Mississippi in July 2015, were sentenced to prison this week for their roles in a large-scale international fraud network.
Assistant Attorney General Kenneth A. Blanco, Acting U.S. Attorney Harold Brittain of the Southern District of Mississippi and Special Agent in Charge Raymond R. Parmer Jr. of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in New Orleans made the announcement.
Oladimeji Seun Ayelotan, 30, was sentenced to 95 years in prison. Rasaq Aderoju Raheem, 31, was sentenced to 115 years in prison. Femi Alexander Mewase, 45, was sentenced to 25 years in prison. After a three-week trial in early 2017, a federal jury found each defendant guilty of offenses involving mail fraud, wire fraud, identity theft, credit card fraud and theft of government property. Ayelotan and Raheem were also found guilty of conspiracies to commit bank fraud and money laundering.
A total of 21 defendants were charged in this case, 12 of whom have pleaded guilty to charges related to the conspiracy, and 11 of whom have been sentenced to date. One of the leaders of the conspiracy, Teslim Olarewaju Kiriji, 30, of Nigeria was previously sentenced to 20 years in prison. Six other defendants were previously sentenced to 10 years in prison each for their roles in this conspiracy: Adekunle Adefila, 41, of Nigeria; Anuoluwapo Segun Adegbemigun, 40, of Nigeria; Gabriel Oludare Adeniran, 30, of Nigeria; Olufemi Obaro Omoraka, 27, of Nigeria; Taofeeq Olamilekan Oyelade, 32, of Nigeria; and Olusegun Seyi Shonekan, 34, of Nigeria. Genoveva Farfan, 45, of California, was sentenced to 9 years in prison, and Rhulane Fionah Hlungwane, 26, of South Africa, to five years in prison for their roles in the conspiracy. Olutoyin Ogunlade, 41, of New York, was sentenced to four years in prison. Dennis Brian Ladden, 75, of Wisconsin was sentenced to time served and six months’ home confinement. Susan Anne Villeneuve, 61, of California, pleaded guilty earlier this month and is awaiting sentencing.
According to the plea agreements and evidence at trial, the defendants and their co-conspirators carried out numerous internet-based fraud schemes dating back at least to 2001. These schemes involved using unsuspecting victims to cash counterfeit checks and money orders, using stolen credit card numbers to purchase electronics and other merchandise and using stolen personal identification information to take over victims’ bank accounts. As a whole, the conspiracy involved tens of millions of dollars in intended losses.
To accomplish their fraud schemes, the conspirators recruited the assistance of U.S. citizens via “romance scams,” in which the perpetrator would typically use a false identity on a dating website to establish a romantic relationship with an unsuspecting victim. According to trial evidence and plea documents, once the perpetrator gained the victim’s trust and affection, the perpetrator would convince the victim to either send money or to help carry out fraud schemes. For example, the defendants admitted that they used romance victims to launder money via Western Union and MoneyGram, to re-package and re-ship fraudulently obtained merchandise and to cash counterfeit checks.
U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) and the U.S. Postal Inspection Service investigated the case. Significant assistance was also provided by the Criminal Division’s Office of International Affairs, the HSI Cyber Crimes Center, HSI Attachés in Pretoria, South Africa and Dakar, Senegal, the U.S. Marshals Service’s International Investigations Branch and the Southern District of Mississippi District Office, the South African Police Service (SAPS) Directorate of Priority Crimes Investigation (DPCI) Electronic Crimes Unit, the SAPS Interpol Extradition Unit, the South African National Prosecution Authority and the South African Department of Justice and Constitutional Development. Trial Attorney Conor Mulroe of the Criminal Division’s Organized Crime and Gang Section, Senior Counsel Peter Roman of the Criminal Division’s Computer Crime and Intellectual Property Section, and Assistant U.S. Attorney Annette Williams of the Southern District of Mississippi tried the case.
If you believe that you may have been a victim of criminal fraud committed by any of the defendants, please go to http://www.justice.gov/usao-sdms/scams and complete the questionnaire. Defendants allegedly used the following email addresses and names to perpetuate the scheme:
Stacy Adams
Marlon Chase
Regina Darwin
Folly Edwards
Kimberly Faye
Lorene M. Garrett
Mark Gentile
John Gervino
Dickson Jones
Anita Lauren
Samuel Maxwell
Mark Miller
Adeline Piper
Sarah Powell
Karen Robinson
Glenn Sattelberg
Kevin Smith
Mark Smith
Richard Wasser
Justin Worsham
Any information that you provide through the questionnaire may be helpful in the criminal investigation and prosecution of this case. A federal investigator may contact you with additional questions or to request documents you may have. Please note that submitting the questionnaire is not a substitute for consulting with your own attorney to determine what actions and remedies may be available to you through civil litigation. If you have any questions related to this matter that are not addressed at the above websites, you may contact federal law enforcement authorities at [email protected].
Three Foreign Nationals Indicted for Illegally Re-entering U.S.Read the Press Release
BIRMINGHAM – A federal grand jury today indicted three Latin American nationals for illegally re-entering the United States, announced Acting U.S. Attorney Robert O. Posey and Immigrations and Customs Enforcement Special Agent in Charge Ray Parmer.
In separate indictments filed in U.S. District Court, the grand jury charged two people from Mexico and one from Honduras for illegally entering the U.S. after previous deportation.
ANELI LIMON CASTREJON, 42, who was living in Oneonta, is charged with being in Blount County on May 3, 2017, after having been removed from the U.S. to Mexico in April 2007 following a conviction for an aggravated felony. Castrejon’s indictment also charges her with misusing a Social Security number in DeKalb County in April and May of this year.
MARCOS ANTONIO PONCE RODRIGUEZ, 25, who was living in Marshall County, is charged with being in Blount County on May 3, 2017, after having been removed to Mexico in May 2013, September 2013 and April 2015. Castrejon and Rodriguez were arrested at a convenience store and gas station in Oneonta where Castrejon worked.
DARWIN MOISES AMADOR-ZEPEDA, 38, a native of Honduras who was living in Huntsville, is charged with being in Madison County on May 16, 2017, after being removed from the U.S. in November 2011 and March 2012. Amador-Zepeda had used many other names, including Darwin M. Amador, Moises Amador, Amador Zepeda-Darwin Moses, Mario Antonio Guillen-Lopez and Mario Guillen-Lopez, according to his indictment.
The maximum penalty for illegally re-entering the U.S. is 20 years in prison and a $250,000 fine. The maximum penalty for misusing a Social Security number is five years in prison and a $250,000 fine.
ICE investigated the cases, which the U.S. Attorney’s Office for the Northern District of Alabama is prosecuting.
An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.
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Three Federal Correctional Officers Charged with Sexually Abusing Female InmatesRead the Press Release
Three separate multi-count indictments were unsealed this morning in United States District Court for the Eastern District of New York charging three federal correctional officers employed by the United States Bureau of Prisons (BOP) variously with deprivation of civil rights under color of law, aggravated sexual abuse, sexual abuse, sexual abuse of a ward, attempted sexual abuse of a ward and abusive sexual contact. The defendants – Lieutenant Carlos Richard Martinez, Lieutenant Eugenio Perez, and Officer Armando Moronta – were arrested earlier today.
The defendants are scheduled to be arraigned this afternoon before United States Magistrate Judge Marilyn D. Go, at the federal courthouse in Brooklyn. United States v. Martinez is assigned to United States District Judge Brian M. Cogan. United States v. Perez is assigned to United States District Judge Kiyo A. Matsumoto; United States v. Moronta is assigned to United States District Judge Roslynn R. Mauskopf.
The arrests are the result of a nearly year-long investigation into allegations of sexual abuse of female prisoners at the Metropolitan Detention Center (MDC) in Brooklyn. The investigation relied upon, among other evidence, the corroborated statements of many female inmate-victims, MDC video surveillance, social media evidence, phone records, documentary records, medical records and physical searches. Following their arrests, Lieutenants Martinez and Perez will be suspended without pay; Officer Moronta was previously suspended without pay for other conduct.
The charges and arrests were announced by Bridget M. Rohde, Acting United States Attorney for the Eastern District of New York; Ronald G. Gardella, Special Agent-in-Charge, United States Department of Justice, Office of the Inspector General, New York Field Office (OIG); William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
“By using their authority and power to prey upon and abuse female inmates in their care, these defendants violated their oaths of public service as well as numerous criminal laws,” stated Acting United States Attorney Rohde. “Our Office is committed to eliminating sexual violence and abuse against inmates in all forms and ensuring that any correctional staff who engage in such conduct are punished.”
“Rape, sexual assault, and threats of retaliation must be aggressively investigated and prosecuted, and Justice Department employees who engage in such conduct should know that the OIG will pursue them and bring them to justice,” stated OIG Special Agent-in-Charge Gardella. “The OIG will continue to conduct independent oversight to help ensure that federal prisons are safe, secure, and free from abuse.”
“As alleged, those charged today trapped their victims in a cycle of fear and intimidation while carrying out various acts of sexual abuse,” stated FBI Assistant Director-in-Charge Sweeney. “This type of conduct is never acceptable, especially at the hands of those who misuse the power afforded them as public servants. We want the public to know we take these crimes seriously and will continue to investigate any and all activity that violates the basic human rights of those within our prison system.”
Carlos Martinez
As alleged in publicly filed documents, over a period of five months from December 2015 to April 2016, the defendant Carlos Martinez used physical force and fear to repeatedly rape a sentenced female prisoner at the MDC. Martinez forced himself on his victim almost every weekend for a period of approximately two months, often multiple times per weekend, exploiting her fear of being sent to the Special Housing Unit and facing additional jail time to ensure her silence. Concerned about a potential investigation of his contact with his victim, Martinez ceased assaulting her for a period of time, before raping her one last time shortly before her transfer to immigration custody. At the time of Martinez’s crimes, he was an active-duty Lieutenant at the MDC, with supervisory and disciplinary authority over inmates.
Eugenio Perez
As alleged in publicly filed documents, over a period of three years from 2013 to 2016, the defendant Eugenio Perez used his position as a Lieutenant at the MDC to engage in sexual acts and contact with five different female inmates detained at the MDC and under the defendant’s supervisory and disciplinary authority. In many cases, Perez’s conduct involved the use of physical force, intimidation and threats of retaliation against his victims. Specifically, on multiple occasions, Perez lured the victims into isolated situations by arranging for them to clean the Lieutenants’ office area at night, and then requiring them to perform oral sex on him, in many cases using force, intimidation and fear of adverse consequences to ensure the victims’ compliance.
Armando Moronta
As alleged in publicly filed documents, the charges relating to the defendant Armando Moronta involve three separate victims. Between May and June 2016, Moronta engaged in criminal sexual contact and acts with female inmates, including inserting his fingers into the vagina of a female inmate and causing inmates to perform oral sex on him while he was assigned to guard their unit.
The charges in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty. Martinez and Perez each face a maximum sentence of life imprisonment, and Moronta faces a maximum sentence of 60 years’ imprisonment, if convicted on all counts.
The investigation is ongoing; anyone with relevant information about prison corruption is asked to contact OIG through its Hotline at (800) 869-4499, or https://oig.justice.gov/hotline/.
The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorneys Nicole M. Argentieri, Marisa Megur Seifan, and Nadia I. Shihata are in charge of the prosecution.
The Defendants:
CARLOS MARTINEZ
Age: 47
Brooklyn, NY
EUGENIO PEREZ
Age: 46
Brooklyn, NY
ARMANDO MORONTA
Age: 39
Brooklyn, NY
E.D.N.Y. Docket Nos. 17 CR 279 (RRM); 17 CR 280 (KAM); and 17 CR 281 (BMC)
Tennessee Woman Sentenced to Three Years for Identity Theft and Tax Fraud ConspiracyRead the Press Release
Conspiracy included two members from Central Kentucky
LEXINGTON, Ky. – A Kingsport, Tenn., woman, who was previously found guilty of participating in a conspiracy to commit identity theft and tax fraud, has been sentenced today to three years in federal prison.
On Wednesday, U.S. District Judge Gregory F. Van Tatenhove sentenced 33-year-old Bonnie Sue Fleenor for conspiracy to commit mail and wire fraud.
Testimony at her trial revealed that Fleenor worked with several other individuals to steal the identifying information of hundreds of Tennessee state prison inmates, to use that information to file false federal income tax returns and fraudulently obtain tax refunds.
Fleenor participated in this conspiracy by handling the fraudulently obtained tax refund checks, supplying forged power-of-attorney forms and other assistance to co-conspirators, who cashed these checks and distributed the proceeds of the fraudulent scheme.
Between November 2008 and June 2013, members of this conspiracy filed hundreds of false federal income tax returns, seeking over $3.2 million in tax refunds. Twelve other individuals have been convicted and sentenced for participation in the conspiracy. These include Adam Alloway (60 months), Gregory Hedges (48 months), David Hedges (48 months), Teresa Rogers (42 months), Ira Lingo (30 months), Linda Ward (21 months), Amanda Hall (16 months), Joyce Bickers (12 months), and Sara Lingerfelt (6 months).
Carlton S. Shier, IV, Acting United States Attorney; Tommy Coke, Inspector in Charge, Pittsburgh Division, U.S. Postal Inspection Service; and Tracey D. Montaño, Special Agent in Charge, Internal Revenue Service Criminal Investigation, jointly made the announcement.
The investigation was conducted by the United States Postal Inspection Service and the Internal Revenue Service. Assistant U.S. Attorneys Andrew T. Boone and Kathryn M. Anderson prosecuted this case on behalf of the federal government.
Tennessee Tax return Preparer Sentenced to Prison for Filing Fraudulent ReturnsRead the Press Release
A Nashville, Tennessee resident was sentenced to serve 12 months and one day in prison today for aiding and assisting in the preparation of fraudulent tax returns, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Jack Smith for the Middle District of Tennessee.
According to documents filed with the court, Tracey Brown operated from her residence a tax return preparation business, Total Tax Services. From approximately January 2006 through December 2010, Brown routinely filed fraudulent tax returns without her clients’ knowledge or permission in an attempt to increase their refunds. On these returns, Brown claimed false medical expenses, charitable contributions and business losses as well as other phony deductions, thereby causing a tax loss of approximately $443,605.
In addition to the prison term imposed, Brown was ordered to serve one year of supervised release and to pay $210,169 in restitution to the Internal Revenue Service (IRS). Brown previously pleaded guilty in September 2016 to one count of aiding and assisting in the preparation of a false tax return.
Acting Deputy Assistant Attorney General Goldberg and Acting U.S. Attorney Smith commended special agents of IRS–Criminal Investigation, who conducted the investigation, and Trial Attorneys Alexander Effendi and Nathan Brooks of the Tax Division and Assistant U.S. Attorney Thomas Jaworski, who prosecuted this case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Tennessee Tax Return Preparer Sentenced to Prison for Filing Fraudulent ReturnsRead the Press Release
A Nashville, Tennessee resident was sentenced to serve 12 months and one day in prison today for aiding and assisting in the preparation of fraudulent tax returns, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Jack Smith for the Middle District of Tennessee.
According to documents filed with the court, Tracey Brown operated from her residence a tax return preparation business, Total Tax Services. From approximately January 2006 through December 2010, Brown routinely filed fraudulent tax returns without her clients’ knowledge or permission in an attempt to increase their refunds. On these returns, Brown claimed false medical expenses, charitable contributions and business losses as well as other phony deductions, thereby causing a tax loss of approximately $443,605.
In addition to the prison term imposed, Brown was ordered to serve one year of supervised release and to pay $210,169 in restitution to the Internal Revenue Service (IRS). Brown previously pleaded guilty in September 2016 to one count of aiding and assisting in the preparation of a false tax return.
Acting Deputy Assistant Attorney General Goldberg and Acting U.S. Attorney Smith commended special agents of IRS–Criminal Investigation, who conducted the investigation, and Trial Attorneys Alexander Effendi and Nathan Brooks of the Tax Division and Assistant U.S. Attorney Thomas Jaworski, who prosecuted this case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Statement from Attorney General Jeff Sessions on Leaks Following the Manchester Terror AttackRead the Press Release
WASHINGTON – Attorney General Jeff Sessions today issued the following statement on the recent leaks following the Manchester terror attack:
“I share the president's deep concern and talked to Home Secretary Rudd yesterday about this matter. These leaks cannot be tolerated and we will make every effort to put an end to it. We have already initiated appropriate steps to address these rampant leaks that undermine our national security.”
Statement by Attorney General Jeff Sessions on the Fourth Circuit Court of Appeals DecisionRead the Press Release
Attorney General Jeff Sessions today issued the following statement on the Fourth Circuit Court of Appeals Decision:
“President Trump’s executive order is well within his lawful authority to keep the Nation safe.”
“The Department of Justice strongly disagrees with the decision of the divided court, which blocks the President’s efforts to strengthen this country’s national security. As the dissenting judges explained, the executive order is a constitutional exercise of the President’s duty to protect our communities from terrorism. The President is not required to admit people from countries that sponsor or shelter terrorism, until he determines that they can be properly vetted and do not pose a security risk to the United States.”
“This Department of Justice will continue to vigorously defend the power and duty of the Executive Branch to protect the people of this country from danger, and will seek review of this case in the United States Supreme Court.”
St. Petersburg Man Pleads Guilty in Deepwater Horizon Fraud SchemeRead the Press Release
Tampa, Florida – Acting United States Attorney W. Stephen Muldrow announces that Joseph Bassler (61, St. Petersburg) has pleaded guilty to mail fraud and money laundering. He faces a maximum penalty of 20 years in federal prison on the mail fraud count and up to 10 years in federal prison for the money laundering offense.
According to the
plea agreement , Bassler, a licensed tax-preparer, held himself out as a professional accountant who could assist companies affected by the Deepwater Horizon oil spill in filing business economic loss claims. As part of his scheme, Bassler prepared and submitted fraudulently inflated claims falsely alleging lost income on behalf of his clients. He also created false documents, including false monthly profit and loss statements, that he provided in support of the fraudulent lost income claims. As payment for his services, he accepted a portion of the recovery money for the loss claims that he had prepared. In total, Bassler submitted 62 claims, three of which were paid. For the three claims that were paid, Bassler and his clients received over $600,000 more than they were entitled from the compensation fund. The remaining claims were denied when Bassler’s fraudulent scheme was discovered.This case was investigated by the Internal Revenue Service Criminal Investigation and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Rachel K. Jones.
South Florida Resident Sentenced to 12 Years in Prison for Committing Armed Robbery of Jewelry Store in Downtown MiamiRead the Press Release
A South Florida resident was sentenced today, by U.S. District Court Donald L. Graham, to 12 years in prison for committing an armed robbery of a jewelry store in the Seybold Building in downtown Miami.
Benjamin G. Greenberg, Acting U.S. Attorney for the Southern District of Florida; Katherine Fernandez Rundle, Miami-Dade State Attorney; George L. Piro, Special Agent in Charge (FBI), Miami Field Division; and Rodolfo Llanes, Chief, City of Miami Police Department (MPD), made the announcement.
Jessie Wooden, 29, of Miami, pled guilty in May of 2017 to conspiring to commit an armed robbery, armed robbery, and possession of a firearm in furtherance of a crime of violence. Judge Graham sentenced Wooden to 154 months in prison, to be followed by 3 years of supervised release.
According to the court record, including the agreed upon factual proffer, on October 29, 2016, Wooden and his co-conspirator robbed a jewelry store located in the Seybold Building in downtown Miami. Once inside the jewelry store, Wooden brandished a firearm while the co-conspirator bound the victim’s hands and feet. The defendant and his co-conspirator stole approximately 35 watches and over $250,000 in U.S. currency.
On January 11, 2017, law enforcement officers attempted to conduct a traffic stop on the vehicle Wooden was driving. Wooden refused to stop and sideswiped an officer’s vehicle in an attempt to evade capture. Ultimately, Wooden crashed his vehicle and was taken into custody. A search of the vehicle revealed a loaded firearm. An additional search of Wooden’s residence revealed over 100 rounds of ammunition.
Mr. Greenberg commends the FBI and MPD for their collaborative work as part of the South Florida Violent Crime Task Force. Mr. Greenberg also thanked the U.S. Marshals Service for their assistance with this matter. This case was prosecuted by Special Assistant U.S. Attorney Marianne Curtis from the Miami-Dade State Attorney’s Office.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Shelby County Woman Indicted for Raising Money on False Cancer ClaimRead the Press Release
BIRMINGHAM – A federal grand jury today indicted a Shelby County woman on multiple fraud charges for falsely claiming she had terminal cancer in order to get money from family and friends and to solicit donations through an online fund-raising site, announced Acting U.S. Attorney Robert Posey, FBI Special Agent in Charge Roger Stanton and Alabama Attorney General Steve Marshall.
A 15-count indictment filed in U.S. District Court charges JENNIFER FLYNN CATALDO, 37, of Sterrett, with eight counts of wire fraud and seven counts of bank fraud.
“This type of deception potentially impacts fund-raising efforts of websites and organizations that exist to raise money for families with true medical needs,” Posey said. “I applaud the cooperative efforts of the FBI and the Alabama Attorney General’s Office in investigating this crime and bringing it forward for prosecution.”
“Sadly, crimes like this make good people think twice before they are willing to be charitable,” Stanton said. “It is hard to comprehend how anyone could sink so low as to claim to have cancer just to fuel their greed.”
“I appreciate the prompt work of Acting U.S. Attorney Robert Posey and FBI Special Agent in Charge Roger Stanton in securing a federal indictment in this case in which state charges have also been brought by warrant,” Marshall said. “We stand together to fight this kind of alleged fraud in which many Good Samaritans from Alabama and other states were victimized. I look forward to working closely with our federal partners in obtaining a conviction and sending a message to would-be criminals that such fraud will be aggressively prosecuted.”
From 2014 to about May 2017, Cataldo misrepresented to friends and family that she had been diagnosed with terminal cancer, according to the indictment. In person, online and via text messages, she solicited contributions from friends and family and received more than $100,000 in donations for living and medical expenses, the indictment charges. In January 2016, Cataldo also created an account on the GoFundMe website titled, “Mom has Terminal Cancer Disney Trip,” with the stated goal of raising $4,000 to take her child to visit Disney before she died, according to the indictment. That account raised more than $10,000.
In September 2016, a friend who believed Cataldo was suffering from terminal cancer created a second GoFundMe account titled, “Jenny Flynn Cataldo Medical Care,” with a $20,000 fund-raising goal, according to the indictment. That account raised more than $25,000 by May 17.
Cataldo transferred money from both GoFundMe accounts into her personal bank account, according to the charges.
The maximum penalty for each count of wire fraud is 20 years in prison and a $250,000 fine. The maximum penalty for bank fraud is 30 years in prison and a $1 million fine.
The FBI and the Alabama Attorney General’s Office investigated the case, which Assistant U.S. Attorney Robin Beardsley Mark is prosecuting.
An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.
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Sentencings for May 24 - May 25, 2017Read the Press Release
Christopher Buchholz, 31, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on May 25, 2017, for conspiracy to distribute 50 grams or more of a mixture or substance containing a detectable amount of methamphetamine and for use of a firearm during and in relation to a drug trafficking crime. Buchholz was arrested in Sheridan, Wyoming. He received 72 months of imprisonment, to be followed by four years of supervised release, and was ordered to pay a $200.00 special assessment and $250.00 in restitution. This case was investigated by the Sheridan Police Department, the Sheridan County Sheriff’s Office, and the Wyoming Division of Criminal Investigation.
Richard John Anderson, 52, of Cheyenne, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on May 25, 2017, for being a felon in possession of a firearm. Anderson was arrested in Cheyenne, Wyoming. He received 30 months of imprisonment, to be followed by three years of supervised release, and was ordered to pay a $100.00 special assessment. This case was investigated by the Cheyenne Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Melissa Millard, 35, of Billings, Montana, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on May 25, 2017, for conspiracy to distribute 50 grams or more of a mixture or substance containing a detectable amount of methamphetamine. Millard was arrested in Sheridan, Wyoming. She received 57 months of imprisonment, to be followed by four years of supervised release, and was ordered to pay a $100.00 special assessment and $600.00 in restitution. This case was investigated by the Sheridan Police Department, the Sheridan County Sheriff’s Office, and the Wyoming Division of Criminal Investigation.
Jose Del Carmen Olivares-Silva, 42, of Mexico, was sentenced by Federal District Court Judge Alan B. Johnson on May 24, 2017, for illegal re-entry of a previously deported alien into the United States. Olivares-Silva was arrested in Cheyenne, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Vidal Jimenez-Herrera, 26, of Mexico, was sentenced by Federal District Court Judge Alan B. Johnson on May 24, 2017, for illegal re-entry of a previously deported alien into the United States. Jimenez-Herrera was arrested in Torrington, Wyoming. He received time served, plus ten days,
was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Neil George Downard, Jr., 31, of Custer, Washington, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on May 24, 2017, for possession with intent to distribute 50 grams or more of a mixture or substance containing a detectable amount of methamphetamine and for possession of a firearm in furtherance of a drug trafficking crime. Downard, Jr., was arrested in Gillette, Wyoming. He received 120 months of imprisonment, to be followed by four years of supervised release, and was ordered to pay a $200.00 special assessment and $400.00 in restitution. This case was investigated by the Campbell County Sheriff’s Office, the Wyoming Division of Criminal Investigation, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Austin Burroughs, 25, of Auburn, New York, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on May 24, 2017, for conspiracy to distribute 50 grams or more of a mixture or substance containing a detectable amount of methamphetamine and for use of a firearm during and in relation to a drug trafficking crime. Burroughs was arrested in Sheridan, Wyoming. He received 60 months and 191 days of imprisonment, to be followed by three years of supervised release, and was ordered to pay a $200.00 special assessment and $400.00 in restitution. This case was investigated by the Sheridan Police Department, the Sheridan County Sheriff’s Office, and the Wyoming Division of Criminal Investigation.
Enrique Rodriguez-Cabrera, 33, of Mexico, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on May 24, 2017, for illegal re-entry of a previously deported alien into the United States. Rodriguez-Cabrera was arrested in Cheyenne, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Stefano Martin Bowling, 41, of Arvada, Colorado, was sentenced by Federal District Court Judge Scott W. Skavdahl on May 24, 2017, for conspiracy to distribute a mixture or substance containing a detectable amount of methamphetamine. Bowling was arrested in Denver, Colorado. He received 58 months of imprisonment, to be followed by three years of supervised release, and was ordered to pay a $100.00 special assessment and $250.00 in restitution. This case was investigated by the Wyoming Division of Criminal Investigation.
Patrick Gene Patterson, 37, of Grants, New Mexico, was sentenced by Federal District Court Judge Alan B. Johnson on May 23, 2017, for conspiracy to distribute 50 grams or more of methamphetamine. Patterson was arrested in Gillette, Wyoming. He received 135 months of imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and $500.00 in restitution. This case was investigated by the Wyoming Division of Criminal Investigation and the U.S. Drug Enforcement Administration.
Travis Aaron Benson, 41, of Casper, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on May 24, 2017, for possession of child pornography. Benson was arrested in Laramie, Wyoming. He received 37 months of imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and $14,000.00 in restitution. This case was investigated by the Wyoming Division of Criminal Investigation Internet Crimes Against Children Task Force and the U.S. Department of Homeland Security.
Sentencing Set for Orem Man who Pleaded Guilty to Possession of Firearm Following Felony ConvictionRead the Press Release
SALT LAKE CITY – Deny De La Cruz Rodriguez, age 23, of Orem, who pleaded guilty Thursday to possession of a firearm and ammunition following a felony conviction, will be sentenced July 27, 2017, at 1:30 p.m. by U.S. District Chief Judge David Nuffer.
In a statement filed in court as a part of his plea agreement, De La Cruz Rodriguez admitted that because of a previous felony conviction for attempted robbery in California, he was prohibited under federal law from possessing a firearm.
On Oct. 25, 2016, law enforcement officers in Orem obtained a warrant to search a house where a gun, used in an Oct. 20, 2016 confrontation between two rival gangs at Orem High School, was believed to have been taken. During the confrontation, an individual pulled out a pistol and fired it in the direction of a rival before all parties left the scene, according to a document filed in state court in Utah County. No one was injured. Another individual has been charged in state court in connection with the firing of the gun during the incident.
When officers executed the warrant on the residence, they encountered De La Cruz Rodriguez and another family member. In the bedroom, where De La Cruz Rodriguez was located, officers recovered a loaded pistol between the bed mattress and the box spring. The pistol had been reported as stolen in Millard County. Law enforcement officers also noted several places in the bedroom where Florencia 13 was tagged, along with the defendant’s gang moniker, “Dreamer.” Florencia 13 was one of the gangs involved in the confrontation at Orem High, along with members of Norteños 13.
“No good will come from an armed gang member who is prohibited from lawfully possessing a firearm,” U.S. Attorney John W. Huber said today. “We are seeing increases in the violent crime rate in our state and in other places around the country. Targeting gang members with firearms is an important way to fight back against violent crime and ensure Utah communities remain safe for all of us.”
De La Cruz Rodriguez faces up to 10 years in federal prison for the firearms conviction.
The case is being prosecuted by Assistant U.S. Attorney Isaac C. Workman and Deputy Utah County Attorney Lance E. Bastian, who is designated as a Special Assistant U.S. Attorney. The Orem Police Department, the Utah County Major Crimes Task Force and the special agents of Homeland Security Investigations have been involved in investigating the case.
Savannah Resident Sentenced to 41 Months in Federal Prison for Medicaid FraudRead the Press Release
SAVANNAH, GA – Barbara Wallace, 52, of Savannah, Georgia, was sentenced by Senior United States District William T. Moore, Jr. yesterday to 41 months in prison for her role in a scheme to defraud Medicaid. Judge Moore also ordered Wallace to serve 3 years of supervised release upon her release from prison, and to pay $948,361 in restitution and forfeiture.
Wallace, the former manager of MBA Diabetic Footwear Solutions, pleaded guilty to one count of health care fraud on September 13, 2016. According to evidence presented at the guilty plea and sentencing hearings, Wallace caused bogus claims to be submitted to Medicaid for medical equipment that was not medically necessary, not prescribed by a physician, and, on many occasions, never provided to a patient. Wallace then used the moneys defrauded from Medicaid for her own personal benefit. Wallace has prior federal convictions for bank fraud, bankruptcy fraud, and social security fraud.
Acting United States Attorney James D. Durham stated, “The Department of Justice will continue to vigorously investigate and prosecute healthcare fraud in its many different forms. This defendant is no stranger to fraud schemes, having now racked up another federal conviction. Those who attempt to steal the taxpayer’s money through healthcare fraud and other scams can expect to join this defendant in a federal prison cell.”
“The Office of the Attorney General will not stand by and allow those who commit fraud to take advantage of programs that are intended to support our state's most vulnerable citizens,” said Georgia Attorney General Chris Carr. “Our Georgia Medicaid Fraud Control Unit will continue to provide vital investigative and prosecutorial support to our partners at the federal and local levels, so that we can guarantee those who seek to undermine the integrity of the Medicaid system are prosecuted to the full extent of the law.”
David J. LeValley, Special Agent in Charge, FBI Atlanta Field Office, stated: “Medicaid fraud is a selfish, greed driven act that takes public funds away from those who truly need them. The sentencing of Ms. Wallace to federal prison will provide much time and opportunity for her to reflect on her self-centered and, more importantly, criminal conduct. The FBI will continue to work with its law enforcement partners in identifying, investigating, and presenting for prosecution those individuals engaged in such healthcare based fraudulent schemes.”
“The Court’s substantial sentence demonstrates that those who commit health care fraud and use the funds gained from that fraud for their own personal benefit will ultimately pay a very high price,” said Derrick L. Jackson, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) for the Atlanta region. “The Office of Inspector General, in concert with our law enforcement partners, will continue to pursue all such cases.”
This case was investigated by the Georgia Medicaid Fraud Control Unit, the FBI, and HHS-OIG. Assistant United States Attorney Scarlett S. Nokes and Special Assistant United States Attorney Amanda Love prosecuted the case on behalf of the United States. For additional information, please contact the U.S. Attorney’s Office at (912) 201-2522.
San Francisco Man Sentenced to 84 Months in Prison for Possession of Child PornographyRead the Press Release
SAN FRANCISCO – Edward Shia was sentenced to 84 months in prison for possession of child pornography, announced United States Attorney Brian J. Stretch and Homeland Security Investigations (“HSI”) Special Agent in Charge Ryan Spradlin. The sentence was handed down yesterday by the Honorable Vince Chhabria, U.S. District Judge.
According to papers filed with the court, Shia, 32, of San Francisco, admitted that he searched for and downloaded child pornography online. A search of Shia’s San Francisco residence resulted in the discovery of more than 12,400 images and 150 videos of child pornography. The majority of the videos depicted children between the ages of three and ten years of age. Shia admitted in an interview that he used the term PTHC (“pre-teen hard core”) to search for and download images of child pornography. He further admitted that he viewed downloading these images as a “release” and that he continued to battle with his sexual desires for children. On May 7, 2015, a federal grand jury indicted Shia, charging him with possession of child pornography, in violation of 18 U.S.C. § 2252(a)(4)(B). Judge Chhabria found Shia guilty of the charge, following a bench trial based on stipulated facts agreed upon by the parties, on December 6, 2016.
In addition to the prison term, Judge Chhabria ordered Shia to serve a five-year period of supervised release. Shia has been free on bond; Judge Chhabria ordered him to surrender on or before July 21, 2017, to begin serving his sentence.
Assistant U.S. Attorney Rita Lin is prosecuting the case. The prosecution is the result of an investigation by the HSI, the San Jose Police Department, and the San Francisco Police Department.
Suspected child sexual exploitation or missing children may be reported to the National Center for Missing & Exploited Children, via its toll-free 24-hour hotline, 1-800-843-5678.
Sacramento Man Charged with Production and Distribution of Child PornographyRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a superseding indictment today against Mark Corum, 60, of Sacramento, adding four counts of production of child pornography to the original indictment brought in December 2016, which charged him with one count of distribution of child pornography, United States Attorney Phillip A. Talbert announced.
According to court documents, Corum engaged in conversations with various Skype users in the Philippines in which he instructed the other parties to perform sexual acts on children while he watched on live webcam. Corum sent the persons located in the Philippines payments via money transmittal services in exchange for them performing the sexual acts he requested on the children and transmitting the images to him via webcam. In addition, on June 23, 2016, Corum transmitted images of prepubescent children engaged in sexually explicit conduct to another person via the internet.
This case was investigated by the Sacramento Internet Crimes Against Children (ICAC) Task Force, a federally and state-funded task force managed by the Sacramento Sheriff’s Department with agents from federal, state, and local agencies. The Sacramento ICAC investigates online child exploitation crimes, including child pornography, enticement, and sex trafficking. Assistant U.S. Attorney Katherine T. Lydon is prosecuting the case.
If convicted, Corum faces a maximum statutory penalty of 20 years in prison on the distribution of child pornography count and maximum statutory penalties of 30 years in prison on each of the four production of child pornography counts, as well as a maximum statutory fine of $250,000 on each count. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about Internet safety education.
Real Estate Developer Pleads Guilty in White Plains Federal Court to Conspiracy to Corrupt the Electoral Process in BloomingburgRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, today announced that KENNETH NAKDIMEN pled guilty to conspiracy to corrupt the electoral process, in connection with an election in Bloomingburg, New York. NAKDIMEN pled guilty earlier today before United States District Judge Vincent Briccetti in White Plains federal court.
Acting Manhattan U.S. Attorney Joon H. Kim stated: “Fair elections are the bedrock of democracy. As he has now admitted, Kenneth Nakdimen devised a scheme to advance his real estate project by falsely registering voters and corrupting this sacred process. We will not allow greed to influence elections at any level.”
According to the allegations contained in the Indictment, as well as statements made in related court filings and proceedings:
Starting in 2006, KENNETH NAKDIMEN, a real estate developer, sought to build and sell real estate in Bloomingburg, New York. From these real estate development projects, NAKDIMEN and others hoped for and anticipated making hundreds of millions of dollars. But by late 2013, the first of their real estate developments had met local opposition, and still remained under construction and uninhabitable. When met with resistance, rather than seek to advance their real estate development project through legitimate means, NAKDIMEN and others instead decided to corrupt the democratic electoral process in Bloomingburg by falsely registering voters and paying bribes for voters who would help elect public officials favorable to their project.
Specifically, in advance of an election in March 2014 for Mayor of Bloomingburg and other local officials, NAKDIMEN and others, and people working on their behalf, developed and worked on a plan to falsely register numerous people who were not entitled to register and vote in Bloomingburg because they actually lived elsewhere. Those people included some who never intended to live in Bloomingburg, some who had never kept a home in Bloomingburg, and indeed, some who had never set foot in Bloomingburg in their lives. NAKDIMEN and others took steps to cover up their scheme to register voters who did not actually live in Bloomingburg by, among other things, creating and back-dating false leases and placing items like toothbrushes and toothpaste in unoccupied apartments to make it seem as if the falsely registered voters lived there.
NAKDIMEN and others also bribed potential voters by offering payments, subsidies, and other items of value to get non-residents of Bloomingburg to register unlawfully and vote there.
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NAKDIMEN, 64, of Monsey, New York, pled guilty to one count of conspiracy to corrupt the electoral process, which carries a maximum sentence of five years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
NAKDIMEN’s sentencing is scheduled for September 9, 2017.
Mr. Kim praised the outstanding investigative work of the FBI-Hudson Valley White Collar Crime Task Force, the Sullivan County District Attorney’s Office, the Sullivan County Sherriff’s Office, the Orange County Sheriff’s Office, the Orange County District Attorney’s Office, the Internal Revenue Service, and the United States Postal Inspection Service. Mr. Kim also thanked the Department of Justice’s Public Integrity Section, Election Crimes Branch, for its assistance in the case.
This case is being handled by the Office’s White Plains Division. Assistant United States Attorneys Kathryn Martin, Benjamin Allee, and Perry Carbone are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the remaining charged defendants are presumed innocent unless and until proven guilty.
Quad Cities Real Estate Developer Pleads Guilty to Investment Fraud Scheme that Resulted in $1.7 Million in LossesRead the Press Release
ROCK ISLAND, Ill. – A Rock Island, Ill., businessman, Todd B. Raufeisen, waived indictment and pled guilty to an information that charged him with defrauding investors in his land development and management projects of approximately $1.7 million. Raufeisen, 56, entered his guilty pleas to one count each of wire fraud and money laundering today before U.S. District Judge Sara Darrow. Sentencing is scheduled on Sept. 14, 2017.
In court documents and statements, Raufeisen admitted that from 2010 to August 2016, he engaged in a scheme that defrauded approximately 22 investors in his development projects and resulted in a loss of approximately $1.7 million. Raufeisen engaged in business under various business names, including RDC Hotel Solutions.
As part of the scheme, Raufeisen promised prospective investors a higher rate of interest than conventional, insured investments and short turnarounds on return of the principle and interest. In exchange for the money invested, Raufeisen promised certain investors that the money would be placed in escrow until needed, would only be used for specific development or management projects, and, if unused, the money would be returned to the investor. In fact, Raufeisen used the investors’ money for personal expenses and to pay previous investors to whom he was indebted.
Further, Raufeisen provided certain investors with promissory notes that promised repayment of invested principle and interest. The notes were purportedly signed and guaranteed by persons who knew nothing of the promissory notes and had not guaranteed repayment to the investors. In fact, Raufeisen admitted that he forged the signatures on the promissory notes.
The Internal Revenue Service Criminal Investigation Division; Federal Bureau of Investigation; and, the Office of the Illinois Secretary of State conducted the investigation. Assistant U.S. Attorney Donald Allegro is prosecuting the case on behalf of the government.
The maximum statutory penalties for the offenses - 20 years in prison for wire fraud; 10 years for money laundering - are provided here for informational purposes, as final sentencing is determined by the court based on the advisory Sentencing Guidelines and other statutory factors. The court may also order the defendant to pay restitution to victims of the offenses.
Pratt Company Pleads Guilty in Oil and Gas Fraud SchemeRead the Press Release
WICHITA, KAN. - A Pratt company pleaded guilty Thursday in an oil and gas fraud scheme, U.S. Attorney Tom Beall said.
Sonstone Trading LLC pleaded guilty to one count of wire fraud. In the plea, the company admitted it agreed to sell 3,000 barrels per month of crude oil to Parnon Industries. In fact, what Sonstone provided to Parnon was not crude oil. It was raw gas oil (RGO), which is a by-product obtained from recycling used motor oil. At sentencing, the court will determine the amount of loss. The government maintains the loss is more than $994,000. Sentencing is set for Aug. 10.
Charges against Sonstone executive David Lawson were dismissed.
For more information on oil and gas fraud from the Financial Fraud Enforcement Task Force, see www.stopfraud.gov/oil-gas-fwg.html .
Beall commended the FBI and Assistant U.S. Attorney Alan Metzger for their work on the case.
Pittsburgh Man Sentenced to Prison for Conspiring to Distribute Crack CocaineRead the Press Release
PITTSBURGH – An Allegheny County resident has been sentenced in federal court to 30 months’ imprisonment on his conviction of conspiracy to distribute and possess with intent to distribute cocaine, Acting United States Attorney Soo C. Song announced today.
United States District Judge Mark R. Hornak imposed the sentence on Ronald Broadus, 43, of Pittsburgh, Pennsylvania.
According to information presented to the court, in 2013, the Federal Bureau of Investigation and other agencies joined forces in a multi-agency wiretap investigation of drug trafficking and violence in the Homewood section of Pittsburgh. The government received authorization to intercept wire and electronic communications over Broadus’s phone for a period of thirty days. During that timeframe, Broadus was intercepted over the wire conspiring with others to possess with intent to distribute and distribute crack cocaine.
Prior to imposing sentence, Judge Hornak stated that the sentence was sufficient but not greater than necessary to fulfill the goals of sentencing.
Assistant United States Attorney Tonya Sulia Goodman prosecuted this case on behalf of the government.
Acting United States Attorney Song commended the Federal Bureau of Investigation, the Greater Pittsburgh Safe Streets Task Force, Wilkinsburg Police Department, Allegheny County Sheriff’s Office, Pennsylvania Office of the Attorney General, Munhall Police Department, Duquesne Police Department, Monroeville Police Department, Allegheny County Police Department, West Mifflin Police Department, Bellevue Police Department, Pennsylvania State Police, United States Postal Inspection Service and the Pittsburgh Bureau of Police for the investigation leading to the successful prosecution of Broadus.
Philadelphia Man Charged with Sextraffcking a Minor via Force, Fraud and CoercionRead the Press Release
Tyquil Clayron Norris III, 20, of Philadelphia, Pennsylvania, was charged today by Indictment with sex trafficking via force, fraud and coercion, and sex trafficking of a minor, announced Acting United States Attorney Louis D. Lappen.
The Indictment alleges that Norris engaged in sex trafficking via force, fraud and coercion, and in the sex trafficking of a minor, between April 2, 2017 and April 4, 2017.
If convicted as charged, the defendant faces a maximum possible sentence of life imprisonment, a mandatory minimum term of 15 years’ imprisonment, supervised release for a minimum term of five years and a lifetime maximum term, a $500,000 dollar fine, mandatory restitution, and a $200 special assessment.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department. The case is being prosecuted by Assistant United States Attorney Seth Schlessinger.
Pakastani Man Pleads Guilty and Is Sentenced for Making False Statements Regarding Assault Rifle AccessoriesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.–Acting U.S. Attorney James P. Kennedy, Jr. announced today that Agha Muhammad Khan Durrani, 28, of Pakistan, pleaded guilty to making a false statement before Chief U.S. District Judge Frank P. Geraci, Jr. Judge Geraci then sentenced the defendant to six months in prison.
Assistant U.S. Attorney Aaron J. Mango, who handled the case, stated that on July 19, 2016, Durrani was interviewed by Special Agents with the United States Department of Homeland Security at the Rainbow Bridge port of entry regarding an investigation into the export of firearm components to Canada. The defendant falsely stated that he did not buy and sell firearms and accessories for business purposes. Subsequently during the interview, Durrani admitted that he did buy firearms and accessories to sell in a business he operated in Pakistan.
The plea and sentencing are the culmination of an investigation by Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent-in-Charge Kevin Kelly and Customs and Border Protection, under the direction of Director of Field Operations Rose Brophy.
Omaha Man Sentenced for Possession with Intent to Distribute MethamphetamineRead the Press Release
Acting United States Attorney Robert C. Stuart announced that on May 24, 2017, Carl Anthony Mangiameli, 52, of Omaha, was sentenced to 18 years and four months (220 months) in prison for possession with intent to distribute methamphetamine. Following the prison term, Mangiameli will serve five years on supervised release.
On August 28, 2015, Mangiameli was contacted by Lincoln Narcotics officers at a Lincoln truck stop. He was found to be in possession of 53 grams of pure methamphetamine and over $2000 in cash. Mangiameli admitted selling methamphetamine since 1999 and said he had gone to the truck stop to collect money from one of his methamphetamine customers and possibly sell additional methamphetamine to that person. Under the federal sentencing guidelines, Mangiameli was determined to be a career offender as a result of two prior Pottawattamie County, Iowa felony drug convictions and a 2005 federal conviction for possession with intent to distribute methamphetamine in the District of Nebraska. This resulted in a substantial enhancement to his sentencing range.
This case was investigated by the Lincoln/Lancaster County Drug Task Force.