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16 May 2017
Fort Polk employee pleads guilty to demanding thousands of dollars in bribes from contractorRead the Press Release
LAKE CHARLES, La. – Acting U.S. Attorney Alexander C. Van Hook announced today that a civilian employee of Fort Polk pleaded guilty to demanding and receiving thousands of dollars from a contracting company performing work on Fort Polk Army installation.
Lucy Ransom, 52, of New Llano, La., pleaded guilty before U.S. Magistrate Judge Kathleen Kay to one count of bribery. The plea will become final when accepted by U.S. District Judge Dee D. Drell. According to the guilty plea, Ransom was a technical representative at the Fort Polk’s department of public works. From November 2013 to September 2016, Ransom extorted a furniture installation company based in New Paris, Ohio, to pay her thousands of dollars in bribes to conduct business on the Fort Polk military installation. The first instance occurred when the company contacted Ransom about bringing dumpsters to the base to dispose of project-related waste. She told the company manger that he would have to pay her $600 and use government dumpsters. After the first payment, Ransom demanded more money from the manager in exchange for her cooperation.
Ransom would make threats if he did not pay. For instance, she threatened to: make the company’s crew stay late by failing to secure worksites upon completion of jobs; restrict access to government buildings in which the contracting company needed to work; call the company’s general contractors to tell them that the company was performing poorly; write reports documenting poor work performance; and take steps to have the company barred from Fort Polk. On several occasions, Ransom carried out her threats until such time as the company manager paid her bribe money.
Ransom faces up to 15 years in prison, three years of supervised release and a $250,000 fine. The court set the sentencing date for September 12, 2017.
The U.S. Army Criminal Investigations Command conducted the investigation. Assistant U.S. Attorney David C. Joseph is prosecuting the case.
Fort Dodge Man to Prison for Violating Supervised ReleaseRead the Press Release
A man who violated the terms of his supervised release was sentenced on May 15, 2017, to three years in federal prison.
LaMarcus Lamar Gully, 31, from Fort Dodge, Iowa, received the prison term on May 15, 2017, after a number of findings of violations of supervised release.
Gully admitted he violated a number of terms of his supervision, including failure to comply with drug testing and committing new law violations, which included State of Iowa convictions, one in December 2015 for assault/domestic abuse and another in October of 2016, for two counts of delivery cocaine to another person.
Gully was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Gully was sentenced to 36 months’ imprisonment. Gully was also ordered to serve his federal sentence consecutive to any time served on his State of Iowa sentences. He will not have to serve any term of supervised release after the prison term. There is no parole in the federal system.
Gully is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the United States Probation Office and Fort Dodge Police Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 08-3005.
Follow us on Twitter @USAO_NDIA.
Fort Dodge Man to Prison for Violating Supervised ReleaseRead the Press Release
A man who violated the terms of his supervised release was sentenced on May 15, 2017, to three years in federal prison.
LaMarcus Lamar Gully, 31, from Fort Dodge, Iowa, received the prison term on May 15, 2017, after a number of findings of violations of supervised release.
Gully admitted he violated a number of terms of his supervision, including failure to comply with drug testing and committing new law violations, which included State of Iowa convictions, one in December 2015 for assault/domestic abuse and another in October of 2016, for two counts of delivery cocaine to another person.
Gully was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Gully was sentenced to 36 months’ imprisonment. Gully was also ordered to serve his federal sentence consecutive to any time served on his State of Iowa sentences. He will not have to serve any term of supervised release after the prison term. There is no parole in the federal system.
Gully is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the United States Probation Office and Fort Dodge Police Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 08-3005.
Follow us on Twitter @USAO_NDIA.
Former Whitman Police Sergeant Pleads Guilty to Embezzling Funds from Disabled VeteransRead the Press Release
BOSTON – A former Whitman, Mass., police sergeant pleaded guilty today in connection with misappropriating funds from the accounts of disabled veterans while he was a fiduciary appointed by the U.S. Department of Veterans Affairs, and for preparing false income tax returns for clients of his tax preparation business.
Glenn P. Pearson, 60, pleaded guilty today to wire fraud, misappropriation by a federal fiduciary, preparation of fraudulent tax returns and obstruction of the Internal Revenue Service. U.S. District Court Chief Judge Patti B. Saris scheduled sentencing for Sept. 19, 2017.
“Mr. Pearson abused his position as a fiduciary and took advantage of vulnerable members of our society,” said Acting U.S. Attorney Weinreb. “Our veterans deserve the best care, and we will hold accountable those who seek to profit at their expense.”
“Glenn Pearson took advantage of disabled military veterans who could not manage their own financial affairs, by diverting hundreds of thousands of dollars in VA payments to his personal benefit,” said Acting Deputy Assistant Attorney General Goldberg. “He then used his tax preparation business to generate more than $1.5 million in bogus refunds and obstructed IRS audits looking into the fraudulent returns he prepared. Today Pearson is held fully accountable for his abuse of trust and fraudulent conduct.”
“Mr. Pearson now finds himself on the opposite end of the very laws he was once sworn to uphold,” said Special Agent in Charge Harold H. Shaw of the FBI’s Boston Field Division. “He took advantage of his position as a fiduciary to steal thousands of dollars from disabled veterans. The FBI will do everything we can to protect citizens against fraud and stop those who steal from them.”
“The American tax system is designed to provide vital government services to our citizens, especially disabled veterans, who have paid the highest price for our freedom,” said Acting Special Agent in Charge Kristina O’Connell of the IRS Criminal Investigation (CI). “Mr. Pearson took advantage of both, motivated by greed and his desired lifestyle. The IRS will use all lawful means to identify and prosecute those, like Pearson, who prepare false tax returns.”
“Pearson deliberately targeted our most vulnerable veterans – those who were unable to handle their own financial affairs,” said Donna L. Neves, Special Agent in Charge of the Department of Veterans Affairs, Office of Inspector General, Northeast Field Office. “Fiduciary fraud, especially in this case of multiple victims, is considered a high priority and aggressively investigated by the VA Office of Inspector General because those veterans deserve protection, not deceit.”
From 2007 to 2012, Pearson was a U.S. Department of Veterans Affairs-appointed fiduciary for eight disabled veterans. Pearson took advantage of that position by misappropriating and embezzling VA-issued benefit money out of the accounts of several veterans for whom he served.
Beginning in 2012, Pearson operated a tax preparation business called FTS Tax Services, through which he prepared false tax returns for clients for a fee. From 2012 through 2015, Pearson prepared numerous tax returns that included false credits and fictitious deductions in an effort to get his clients larger refunds than they were entitled to receive. When Pearson’s clients were audited by the IRS, Pearson took steps to obstruct the audits by making false statements to the IRS and preparing false documents for his clients to submit to the IRS during the audits.
The charge of wire fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000, or twice the gain or loss to the victims; the charge of misappropriation of funds by a fiduciary provides for a sentence of no greater than five years in prison, three years of supervised release and a fine of $250,000, or twice the gain or loss to the victims; preparing false tax returns provides for a sentence of three years in prison, one year of supervised release and a fine of $250,000; attempting to interfere with the administration of internal revenue laws provides for a sentence of no greater than three years in prison, one year of supervised release and a fine of $250,000. According to the terms of the plea agreement, Pearson will pay restitution to the victims, the VA and the IRS. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting U.S. Attorney Weinreb, Acting Assistant Attorney General Goldberg, FBI SAC Shaw, IRS-CI Acting SAC O’Connell and VA-OIG SAC Neves made the announcement today. Assistant U.S. Attorney Vassili Thomadakis, of Weinreb’s Criminal Division, and Karen Kelly, Assistant Chief of the Justice Department’s Tax Division, are prosecuting the case.
Former Tax Return Preparer Pleads Guilty to Filing False ReturnsRead the Press Release
RICHMOND, Va. – A Chester woman who worked as a tax return preparer from 2011 through 2015 pleaded guilty today to filing false tax returns.
According to the statement of facts filed with the plea agreement, Crystal Charmae Jackson, 44, admitted to conspiring with David Wayne Schneider to prepare and file false returns on behalf of clients that contained false entries as to clients’ Schedule C income, losses from small businesses, as well as clients’ dependents. These false entries resulted in the issuance of inflated refunds to the clients. On many occasions, those fraudulently obtained refunds were deposited into the bank accounts of Zimmerman Bail Bonding, a company owned by Schneider. Schneider was sentenced to 24 months in prison in April 2016, and ordered to pay $515,104.74 in restitution to the IRS for losses resulting from his preparation of false tax returns.
Jackson pleaded guilty to conspiracy to submit false claims, and making false claims. Jackson faces a maximum penalty of 15 years in prison when sentenced on September 12. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Kimberly Lappin, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI); Anthony Scott, Special Agent-in-Charge, U.S. Department of Treasury, Office of Inspector General; and Michael McGill, Special Agent-in-Charge, Social Security Administration Office of the Inspector General, made the announcement after U.S. District Judge John A. Gibney, Jr., accepted the plea. Assistant U.S. Attorney Michael C. Moore is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:16-cr-155.
Former State Senator Sentenced to Eight Months for Mail and Tax FraudRead the Press Release
Winston-Salem, N.C. – A former North Carolina state senator was sentenced today to eight months in prison on federal fraud and tax charges, announced Acting United States Attorney Sandra J. Hairston.
Fletcher Lee Hartsell, Jr., who represented parts of Cabarrus and Union Counties as a State Senator from 1991 until 2016, previously pleaded guilty to one count of mail fraud and two counts of filing false tax returns before United States District Judge Thomas D. Schroeder. Hartsell admitted that he engaged in a scheme to defraud and to obtain money through false pretenses by soliciting funds through the mail for the Hartsell for NC State Senator Committee, using those funds for personal goods and services not authorized under state campaign finance laws, and then misrepresenting such expenditures on filed campaign disclosure reports. Hartsell further admitted that he made knowing and willful false statements in federal income tax returns filed both in his personal capacity and on behalf of a corporation he co-managed.
Hartsell agreed to pay full restitution to the Internal Revenue Service in the amount of $63,516 and to forfeit $184,059.88 in proceeds derived from his criminal conduct.
“Transparency, honesty, and integrity on the part of elected officials allows citizens to make informed decisions about their campaign contributions and at the ballot box. This sentence should serve as a reminder that those occupying positions of public trust will be held accountable under the same criminal laws as their constituents,” said Acting United States Attorney Hairston.
“Mr. Hartsell has learned first-hand what happens when you abuse the power granted to you as an elected official. He must pay back the American people; money that he used for his own expenses and prison time for degrading our democratic process,” said John Strong, Special Agent in Charge of the Federal Bureau of Investigation (“FBI”) in North Carolina.
“Today’s sentence sends a clear message that the laws of the land apply to everyone, regardless of their position,” said Internal Revenue Service – Criminal Investigations (“IRS-CI”) Special Agent in Charge Thomas J. Holloman, III. “If you commit a crime, status as a political leader will not protect you from federal prosecution. Hartsell made a conscious decision to deceive and benefit personally at the expense of the citizens of Cabarrus and Union counties.”
The investigation was investigated by the FBI and IRS-CI with assistance from the North Carolina State Bureau of Investigation, and was prosecuted by Assistant U.S. Attorney JoAnna G. McFadden.
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Former Pulaski County Sheriff's Office Employee Pleads Guilty, Admits to Stealing Sheriff's Office FundsRead the Press Release
LITTLE ROCK—Patrick C. Harris, Acting United States Attorney for the Eastern District of Arkansas, and Diane Upchurch, Special Agent in Charge of the Little Rock Field Office of the Federal Bureau of Investigation (FBI), announced today that former Pulaski County Sheriff’s Office (PCSO) employee Kelvin Hendrix, 48, of Bauxite, pleaded guilty to conspiracy to commit mail fraud. Jennifer Gann, 36, of North Little Rock, who conspired with Hendrix to steal funds from the PCSO, also pleaded guilty to the same charge.
Hendrix and Gann each waived indictment and pleaded to a one-count federal Information. Today’s hearings took place in Little Rock before United States District Court Judge D.P. Marshall Jr., who will sentence Hendrix and Gann on October 12.
As detailed in the change of plea hearings, between April 2011 and April 2016, Hendrix, a former Quartermaster for the Pulaski County Regional Detention Center who worked for the PCSO for 25 years, and Gann, a former employee at Cruse Uniforms & Equipment, devised a scheme to steal funds allocated by the PCSO for the purchase of uniforms and equipment. The pair then used those stolen funds to purchase firearms and other goods from Cruse for personal use.
As the Quartermaster, Hendrix managed the purchase and distribution of uniforms and equipment for all employees working at the jail. All uniforms and equipment for these employees are purchased from Cruse. Gann was the Inside Sales Manager for Cruse and worked for Cruse for 16 years.
Detention Center employees received a uniform and equipment monetary allowance, to be used at Cruse. As part of the scheme, Hendrix provided Gann a list of employees who had not used their entire allowance, and Gann created false purchase invoices for items purportedly purchased by those employees. Based on those false purchase orders, the PCSO remitted payment (via the United States Postal Service) to Cruse. Gann would then produce another invoice showing the items as returned, and credit the value of the items to Hendrix—rather than the PCSO—in the form of a store credit.
As an example, on December 2, 2015, Gann created a purchase invoice with information provided by Hendrix, for the purchase of 42 PCSO tee shirts. The total charged to PCSO in connection with this purchase invoice was $526.47. Gann then created a return of merchandise invoice documenting the return of the 42 shirts, but issued $526.47 in store credit to Hendrix personally. That same day Hendrix purchased two handguns—a Glock Model 43 and a used Glock Model 30—for $553.72, primarily paid for with the store credit.
Hendrix purchased more than 40 firearms in this manner. Hendrix and Gann also admitted in their plea agreements that, throughout the entirety of the scheme, PCSO’s loss amount is between $40,000 and $95,000. The issue of the exact amount of restitution will be determined at sentencing.
The charge of conspiracy to commit mail fraud, pursuant to 18 U.S.C. § 371, carries a statutory penalty of not more than five years’ imprisonment, not more than a $250,000 fine, and not more than three years of supervised release. This case was investigated by the FBI and is being prosecuted by Assistant United States Attorney Benecia B. Moore.
Former Massachusetts Police Sergeant Pleads Guilty to Embezzling Funds from Disabled Veterans and Running Fraudulent Tax Preparation BusinessRead the Press Release
A former Whitman, Massachusetts police sergeant pleaded guilty today to wire fraud, preparing false income tax returns for clients of his tax preparation business, obstructing the internal revenue laws and misappropriating funds from the accounts of disabled veterans while he was a fiduciary appointed by the U.S. Department of Veterans ffairs (VA), announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney William D. Weinreb for the District of Massachusetts.
According to documents filed with the Court, from 2007 to 2012, Glenn P. Pearson, 61, was appointed a VA fiduciary for eight disabled veterans of the U.S. armed forces. A veteran, who has been awarded VA benefits but is unable to manage his or her funds due to injury, disease, mental incompetence or infirmities of advanced age, can have another individual, referred to as a fiduciary, appointed by the VA to receive funds on the veteran’s behalf and to manage those funds for the benefit of the veteran. Pearson used his position as a fiduciary to misappropriate and embezzle more than $250,000 in VA-issued benefit money from the accounts of several veterans.
Moreover, beginning in 2012, Pearson operated FTS Tax Services, a tax preparation business through which he prepared false tax returns for clients for a fee. From 2012 through 2015, Pearson prepared numerous tax returns that included false credits and fictitious deductions in an effort to get his clients bigger refunds than they were entitled to receive. When Pearson’s clients were audited by the Internal Revenue Service (IRS), Pearson took steps to obstruct the IRS—including making false statements to the IRS and preparing false documents for his clients to submit to the IRS during the audits. Pearson admitted to causing a tax loss of more than $1.5 million.
“Glenn Pearson took advantage of disabled military veterans who could not manage their own financial affairs, by diverting hundreds of thousands of dollars in VA payments to his personal benefit,” said Acting Deputy Assistant Attorney General Goldberg. “He then used his tax preparation business to generate more than $1.5 million in bogus refunds and obstructed IRS audits looking into the fraudulent returns he prepared. Today, Pearson is held fully accountable for his abuse of trust and fraudulent conduct.”
“Mr. Pearson abused his position as a fiduciary and took advantage of vulnerable members of our society,” said Acting U.S. Attorney Weinreb. “Our veterans deserve the best care, and we will hold accountable those who seek to profit at their expense.”
“Mr. Pearson now finds himself on the opposite end of the very laws he was once sworn to uphold,” said Special Agent in Charge Harold H. Shaw of the FBI’s Boston Field Division. “He took advantage of his position as a fiduciary to steal hundreds of thousands of dollars from disabled veterans. The FBI will do everything we can to protect citizens against fraud, and stop those who steal from them.”
“The American tax system is designed to provide vital government services to our citizens, especially disabled veterans, who have paid the highest price for our freedom,” said Acting Special Agent in Charge Kristina O’Connell of the IRS Criminal Investigation (CI). “Mr. Pearson took advantage of both, motivated by greed and his desired lifestyle. The IRS will use all lawful means to identify and prosecute those, like Pearson, who prepare false tax returns.”
“Pearson deliberately targeted our most vulnerable veterans – those who were unable to handle their own financial affairs,” said Special Agent in Charge Donna L. Neves of the VA Office of Inspector General (OIG), Northeast Field Office. “Fiduciary fraud, especially in this case of multiple victims, is considered a high priority and aggressively investigated by the VA Office of Inspector General because those veterans deserve protection, not deceit.”
Sentencing is scheduled for Sept. 19 before Judge Saris. Pearson faces a statutory maximum sentence of 20 years in prison for wire fraud, five years in prison for misappropriation of funds by a fiduciary, three years in prison for preparing false tax returns, and three years in prison for attempting to interfere with the administration of internal revenue laws. As part of the terms of the plea agreement, Pearson will make restitution to the veterans, the VA and the IRS. Pearson also faces a period of supervised release and monetary penalties. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Goldberg and Acting U.S. Attorney Weinreb thanked special agents of IRS–CI, FBI and VA-OIG, who conducted the investigation, and Assistant U.S. Attorney Vassili Thomadakis and Assistant Chief Karen Kelly of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Former Manager of Public Utility Arrested for Defrauding the Public Utility and Its Customers Out of More Than $3.8 MillionRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced today that JOHN FARCHIONE, a former customer operations manager of a public utility company (the “Public Utility”), and LOUIS BENDEL, who ran a business purporting to assist customers with payments to the Public Utility, were arrested this morning and charged with honest services fraud, bank fraud, mail fraud, aggravated identity theft, and conspiracy, for their roles in a scheme to defraud the Public Utility and its customers out of more than $3.8 million. BENDEL was presented today before U.S. Magistrate Judge Gabriel W. Gorenstein. FARCHIONE was arrested in Maine this morning and was presented in federal court there today.
Acting U.S. Attorney Joon H. Kim said: “John Farchione, an employee of a public utility, and Louis Bendel, the owner of a payment processing vendor, allegedly stole more than $3.8 million from the public utility and its customers. As alleged, instead of providing the fair and honest services the public deserves and the law requires, the defendants instead looked to the public utility as a vehicle to satisfy their personal greed. We thank our partners at the FBI for protecting New York’s public utilities and their customers.”
FBI Assistant Director William F. Sweeney Jr. said: “As alleged, Farchione, aided by his inside knowledge of the billing and payment process of the public utility for which he worked, found a way to exploit procedures in furtherance of a scheme abetted by Bendel. Bendel, whose job it was to remit customer payments to the utility company, allegedly conspired with Farchione to subvert the system, allowing for their personal enrichment to the detriment of the company and its consumers. The right to honest services is something every member of the public should enjoy, and those who stand in the way will most certainly be held accountable.”
According to the Complaint[1] unsealed today in Manhattan federal court:
From at least in or about 2005, up to and including in or about November 2016, FARCHIONE and BENDEL engaged in fraudulent schemes resulting in the theft of more than $3.8 million from the Public Utility and its customers.
FARCHIONE, who was employed by the Public Utility as a manager in Customer Operations during the relevant time period, devised and implemented the scheme, using his knowledge of the Public Utility’s billing and payment processes. FARCHIONE carried out the scheme with BENDEL, who operated a business that aggregated payments from customers of the Public Utility for the purpose of passing such payments on to the Public Utility. FARCHIONE and BENDEL effected the fraud in part through conspiring to submit fraudulent checks and payments to the Public Utility, in amounts owed by customers who provided cash to BENDEL believing he would submit those payments to the Public Utility on their behalf.
In fact, however, FARCHIONE and BENDEL kept the customer cash for themselves and submitted fraudulent checks to the Public Utility that purported to convey aggregated payments by multiple customers of the Public Utility. FARCHIONE, by virtue of his position as an employee of the Public Utility, was able to conceal the nature of the fraudulent checks, and thereby perpetuate the fraudulent scheme, through his knowledge of and access to the Public Utility’s account payment system.
Additionally, FARCHIONE and BENDEL conspired to create fraudulent positive balances on certain customer accounts associated with BENDEL, causing the Public Utility to issue unearned account refunds, the proceeds of which were obtained and shared by FARCHIONE and BENDEL.
* * *
FARCHIONE, 64, of Queens, and BENDEL, 69, of Seaford, Long Island, are each charged with one count of honest services fraud, which carries a maximum sentence of 20 years in prison; mail fraud, which carries a maximum sentence of 20 years in prison; bank fraud, which carries a maximum sentence of 30 years in prison; conspiracy to commit honest services fraud, mail fraud, and bank fraud, which carries a maximum sentence of 30 years in prison; and aggravated identity theft in connection with the fraudulent schemes, which carries a mandatory sentence of two years in prison, to be served consecutively to any other sentence imposed.
The statutory maximum and mandatory penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants would be determined by the judge.
Mr. Kim praised the investigative work of the FBI in this investigation.
This case is being handled by the Office’s Public Corruption Unit. Assistant U.S. Attorney Alex Rossmiller is in charge of the prosecution.
[1] The charges contained in the Complaint are merely accusations, and FARCHIONE and BENDEL are presumed innocent unless and until proven guilty.
Former Dunkirk Mayor Sentenced for Using Campaign Contributions for His Own Personal BenefitRead 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 former City of Dunkirk Mayor Richard L. Frey, 85, of Dunkirk, NY, who was convicted of wire fraud involving a scheme to defraud his mayoral campaign and his supporters by stealing campaign contributions for his personal benefit, was sentenced to six months home confinement by U.S. District Judge Richard J. Arcara. The defendant was also ordered to pay restitution totaling $54,361.30.
Assistant U.S. Attorney John D. Fabian and Department of Justice Trial Attorney Edward P. Sullivan of the Criminal Division’s Public Integrity Section, who handled the case, stated that the defendant was the City of Dunkirk mayor from January 2002 until January 2012. During that time, Frey had substantial personal debt.
From January 2003, to June 2012, the defendant devised and executed a scheme to defraud the co-owners of a hospitality company that owned a hotel in Dunkirk and the owner of a food production company in Dunkirk by inducing them to make contributions to his mayoral and other political campaigns. After receiving checks from these individuals, Frey, rather than depositing the funds into a campaign or official account, simply spent them for his own personal benefit. The contributions totaled $54,361.30. In addition, Frey failed to report or disclose the contributions on his campaign disclosure reports, which is required of local candidates for public office.
The sentencing is the culmination of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Adam S. Cohen and the U.S. Housing and Urban Development, Office of Inspector General, under the direction of Special Agent in Charge Brad Geary.
Five Plead Guilty for Conspiring to Obstruct IRS, Wire FraudRead the Press Release
Abingdon, VIRGINIA – Five Max Meadows, Virginia residents, who skimmed over $1 million in cash from a Wythe County store and then failed to pay taxes on that money, pled guilty today to federal conspiracy charges, Acting United States Attorney Rick A. Mountcastle announced.
Harold Hart, 80, Larry Dean Ball, 68, Mary Carroll Ball, 67, Katrina Rose Freeman, 42, and Gary Daniel Musick, 45, all of Max Meadows, waived their rights to be indicted and pled guilty today to Informations charging them each with one count of conspiracy to impair, impede or obstruct the lawful function of the Internal Revenue Service and to commit wire fraud. At sentencing, each defendant faces a maximum possible penalty of up to five years in prison and a fine of up to $250,000.
The defendants have agreed to pay, within 60 days of today’s hearing, over $440,000 in evaded federal taxes, interest and penalties, over $100,000 in evaded state taxes, interest, and penalties, over $40,000 in fines, and a forfeiture of over $29,000. The United States seized over $275,000 in cash from the defendants while executing search warrants in Wythe County in August 2016.
According to evidence presented at today’s hearing by Assistant United States Attorney Randy Ramseyer, The Old Fort Western Store in Wythe County was opened in the 1990s by Hart and Larry Ball and is operated as a retail western wear facility that sells western apparel, footwear, saddles and other items. Hart is the grandfather of Freeman and Musick. Larry Ball is the husband of Mary Ball and the father of Freeman.
Beginning in 2010, Hart, Larry Ball, Mary Ball, Freeman and Musick agreed that cash would be skimmed from the income of Old Fort, no sales tax would be paid on the skimmed cash, some of the skimmed cash would be used to pay certain employees a cash payroll in addition to their regular pay checks, some of the skimmed case would be used to pay Old Fort Partnership rent in addition to the rent check it received each month and the remainder of the skimmed cash would be disturbed to Hart, Larry and Mary Ball, Musick and Freeman and another person.
Between 2010 and 2016, the conspirators skimmed $1,121,458 in cash from Old Fort for the purpose of hiding this income from the Internal Revenue Service and the Virginia Department of Taxation.
United States District Judge James P. Jones accepted the defendants guilty pleas and scheduled sentencing hearings for September 18, 2017, in Abingdon.
The investigation of the case was conducted by the Bristol, Virginia, office of the Internal Revenue Service – Criminal Investigation. Assistant United States Attorney Randy Ramseyer is prosecuting the case for the United States.
Financial Freedom Settles Alleged Liability for Servicing of Federally Insured Reverse Mortgage Loans for $89 MillionRead the Press Release
Financial Freedom has agreed to a settlement with the United States of more than $89 million to resolve allegations that it violated the False Claims Act and the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) in connection with its participation in a federally insured Home Equity Conversion Mortgages (HECM) or ‘reverse mortgage’ program, the Justice Department announced today. Financial Freedom is headquartered in Austin, Texas.
“The Department of Justice is committed to ensuring that those who participate in federal mortgage insurance programs comply with requirements essential to the success of its programs,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “Among these requirements are the deadlines imposed by the Federal Housing Administration (FHA) on those who service government insured mortgages. Those deadlines are designed to protect the government’s collateral and stop the unnecessary loss of government funds and resources.”
Through ‘reverse mortgage’ loans, older people are able to access the equity in their homes by borrowing money against the equity they have built in their home. To encourage reverse mortgage loans, the FHA protects lenders from loss by providing mortgage insurance. Under FHA’s program, a loan becomes due and payable when the home is sold or vacant for more than 12 months or upon the death of the homeowner, whichever comes first. The lender is repaid the amount of the loan, including the costs of servicing the loan and any interest that accrues on lender expenses after a loan becomes due and payable. FHA will reimburse a lender that is unable to recoup the full amount of the loan. In order to claim recoupment, the servicer is required to meet a number of regulatory requirements and deadlines.
The United States alleged that Financial Freedom sought to obtain insurance payments for interest from FHA despite failing to properly disclose on the insurance claim forms it filed with the agency that the mortgagee was not eligible for such interest payments because it had failed to meet various deadlines relating to appraisal of the property, submission of claims to HUD, and pursuit of foreclosure proceedings. As a result, from March 31, 2011 to August 31, 2016, the mortgagees on the relevant reverse mortgage loans serviced by Financial Freedom allegedly obtained additional interest that they were not entitled to receive.
The United States’ investigation arose from a declaration filed pursuant to FIRREA by Sandra Jolley, a consultant for the estates of borrowers who took out HECM loans. Under FIRREA, whistleblowers may file declarations concerning alleged violations of the statute and may obtain a share of the recovery. Ms. Jolley will receive $1.6 million from the settlement.
“This settlement represents our office’s continued commitment to protecting the financial solvency of vital financial programs designed to benefit America’s seniors,” said Acting U.S. Attorney Stephen Muldrow of the Middle District of Florida. “HECM servicers must be held accountable for failing to adhere to FHA requirements that are designed to ensure the continued viability of the HECM program. We are pleased that Financial Freedom agreed to accept financial responsibility for these failures.”
“Today’s settlement agreement resolves allegations that this lender failed to comply with FHA servicing requirements and sought to receive financial gains that it was not legally entitled to,” said HUD Inspector General David A. Montoya. “These actions today demonstrate our continued commitment to address and halt business practices that pose a serious risk to the FHA program and the public’s trust in HUD administered programs.”
The settlement was the result of the coordinated efforts of the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Middle District of Florida, and the Department of Housing and Urban Development’s Office of Inspector General and Office of General Counsel. The case was handled by Assistant U.S. Attorney Kyle Cohen, along with Trial Attorneys Sean O’Donnell and Christopher Reimer of the Department of Justice Civil Frauds Section.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Financial Freedom Settles Alleged Liability for Servicing of Federally Insured Reverse Mortgage Loans for $89 MillionRead the Press Release
Fort Myers, FL - Financial Freedom has agreed to a settlement with the United States of more than $89 million to resolve allegations that it violated the False Claims Act and the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) in connection with its participation in a federally insured Home Equity Conversion Mortgages (HECM) or ‘reverse mortgage’ program, the Justice Department announced today. Financial Freedom is headquartered in Austin, Texas.
“This settlement represents our office’s continued commitment to protecting the financial solvency of vital financial programs designed to benefit America’s seniors,” said Acting U.S. Attorney Muldrow. “HECM servicers must be held accountable for failing to adhere to FHA requirements that are designed to ensure the continued viability of the HECM program. We are pleased that Financial Freedom agreed to accept financial responsibility for these failures.”
“The Department of Justice is committed to ensuring that those who participate in federal mortgage insurance programs comply with requirements essential to the success of its programs,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “Among these requirements are the deadlines imposed by the Federal Housing Administration (FHA) on those who service government insured mortgages. Those deadlines are designed to protect the government’s collateral and stop the unnecessary loss of government funds and resources.”
Through ‘reverse mortgage’ loans, older people are able to access the equity in their homes by borrowing money against the equity they have built in their home. To encourage reverse mortgage loans, the FHA protects lenders from loss by providing mortgage insurance. Under FHA’s program, a loan becomes due and payable when the home is sold or vacant for more than 12 months or upon the death of the homeowner, whichever comes first. The lender is repaid the amount of the loan, including the costs of servicing the loan and any interest that accrues on lender expenses after a loan becomes due and payable. FHA will reimburse a lender that is unable to recoup the full amount of the loan. In order to claim recoupment, the servicer is required to meet a number of regulatory requirements and deadlines.
The United States alleged that Financial Freedom sought to obtain insurance payments for interest from FHA despite failing to properly disclose on the insurance claim forms it filed with the agency that the mortgagee was not eligible for such interest payments because it had failed to meet various deadlines relating to appraisal of the property, submission of claims to HUD, and pursuit of foreclosure proceedings. As a result, from March 31, 2011 to August 31, 2016, the mortgagees on the relevant reverse mortgage loans serviced by Financial Freedom allegedly obtained additional interest that they were not entitled to receive.
The United States’ investigation arose from a declaration filed pursuant to FIRREA by Sandra Jolley, a consultant for the estates of borrowers who took out HECM loans. Under FIRREA, whistleblowers may file declarations concerning alleged violations of the statute and may obtain a share of the recovery. Ms. Jolley will receive $1.6 million from the settlement.
“Today’s settlement agreement resolves allegations that this lender failed to comply with FHA servicing requirements and sought to receive financial gains that it was not legally entitled to,” said HUD Inspector General David A. Montoya. “These actions today demonstrate our continued commitment to address and halt business practices that pose a serious risk to the FHA program and the public’s trust in HUD administered programs.”
The settlement was the result of the coordinated efforts of the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Middle District of Florida, and the Department of Housing and Urban Development’s Office of Inspector General and Office of General Counsel. The case was handled by Assistant U.S. Attorney Kyle Cohen, along with Trial Attorneys Sean O’Donnell and Christopher Reimer of the Department of Justice Civil Frauds Section.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Federal Officials Close Review of Fatal Shooting of Antwun ShumpertRead the Press Release
WASHINGTON – The U.S. Attorney’s Office for the Northern District of Mississippi and the Civil Rights Division of the Justice Department announced today that they have completed a thorough, independent investigation into the fatal shooting of Antwun Shumpert on June 18, 2016, by Tupelo Police Department Officer Tyler Cook. This investigation revealed that the evidence is insufficient to prove, beyond a reasonable doubt, that Cook violated federal civil rights laws. Accordingly, the U.S. Attorney’s Office for the Northern District of Mississippi and the Civil Rights Division of the Justice Department will not pursue federal criminal civil rights charges against Cook.
Officials from the U.S. Attorney’s Office and the Justice Department’s Civil Rights Division met with members of Shumpert’s family today to inform them of this decision.
The U.S. Attorney’s Office for the Northern District of Mississippi, the Department of Justice’s Civil Rights Division, and the Federal Bureau of Investigation (FBI) conducted a comprehensive, independent review of the circumstances related to Shumpert’s death. The investigation included a review of witness interviews; the autopsy report; crime-scene reports; photographs; surveillance video that recorded auxiliary areas of the crime scene; police radio traffic; incident reports; an interview with the medical examiner; and an interview with the officer.
In conducting the review, federal authorities were tasked with determining whether Cook violated federal law by willfully using unreasonable force against Shumpert. Under the applicable federal criminal civil rights statute, prosecutors would be required to establish, beyond a reasonable doubt, that a law enforcement officer willfully deprived Shumpert of a constitutional right. To establish willfulness, federal authorities would be required to show that the officer acted with the deliberate and specific intent to do something the law forbids. This is the highest standard of intent imposed by law. Mistake, misperception, negligence, necessity, or poor judgment are not sufficient to establish a federal criminal civil rights violation.
The evidence in this investigation showed that on June 18, 2016, the Tupelo Police Department was conducting a surveillance operation. At around 9:30 at night, officers observed a tan car stop for a short time in a motel parking lot before leaving. Officer Joseph Senter followed the car and noted that it did not properly use a turn signal and was missing a tag light, both of which are traffic violations. Officer Senter signaled to the car to stop, but the car traveled several more blocks before stopping. Immediately after Shumpert stopped the car, he fled on foot. Officer Senter ordered Shumpert to return to the vehicle, but he did not. Officer Senter began chasing Shumpert and radioed for assistance.
Cook was among the officers who responded to Officer Senter’s call for assistance. Cook stopped his car on Harrison Street and got out along with his patrol dog. The patrol dog picked up a scent and led Cook to a ditch behind a house at 916 Harrison Street. The house had a crawl space below it, and Cook saw a hand holding the door shut. Cook reported that he drew his weapon, opened the door to the crawl space, and saw Shumpert. He ordered Shumpert to come out or the dog would bite him, but Shumpert did not emerge. Cook then instructed the dog to bite Shumpert. The dog bit Shumpert on the arm, and Shumpert began punching the dog and grabbing its head. Shumpert escaped the dog by taking off his own shirt—which the dog had hold of—and ran out of the crawl space to tackle Cook.
Cook said he landed a couple of punches on Shumpert before Shumpert forced him to the ground. Once on the ground, Cook said that he was punching with both hands, including the hand that was holding his gun, and may have struck Shumpert with his gun. Cook described Shumpert as being on top of him and striking him in the face multiple times. Cook said that he “tried to fight back but I began to see stars and thought I was going to loose [sic] consciousness and I was in fear for my life.” Cook then remembers shooting his gun three or four times.
Three other officers, none of whom could see the incident, each reported hearing about four gunshots in quick succession. Three civilian witnesses heard the shooting as well, but none saw it. Two officers ran to the scene immediately after the shooting. Radio traffic shows that the officers called for medical support within two minutes of the shooting, and that Shumpert was transported to North Mississippi Medical Center several minutes after that. He died from the gunshot wounds about five hours later.
In this instance, there is no reliable evidence to contradict the assertion that Cook fired at Shumpert because he perceived him to be a deadly threat to himself and others. When officers first encountered Shumpert, they attempted to defuse the situation using repeated verbal commands to surrender. Cook also attempted to use non-lethal means, including the patrol dog. It was only when Shumpert punched Cook in the head and Cook feared losing consciousness that he fired his gun.
Based on a legal analysis of the record, the U.S. Attorney and the Civil Rights Division have concluded that there is insufficient evidence to establish that Cook acted with the requisite criminal intent. Therefore, after a careful and thorough review, experienced federal prosecutors have determined that the evidence is insufficient to prove, beyond a reasonable doubt, that Cook violated 18 U.S.C. § 242. Accordingly, the review into this incident has been closed without prosecution.
The U.S. Attorney’s Office, the Civil Rights Division, and the FBI are committed to investigating allegations of civil rights violations by law enforcement officers and will continue to devote the resources required to ensure that all allegations of serious civil rights violations are fully and completely investigated. The department will aggressively prosecute criminal civil rights violations whenever there is sufficient evidence to do so.
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Federal Grand Jury Indicts Texas State Senator Carlos UrestiRead the Press Release
In San Antonio today, a federal grand jury returned two separate indictments against District 19 Texas State Senator Carlos I. Uresti announced United States Attorney Richard L. Durbin, Jr., and Federal Bureau of Investigation (FBI) Special Agent in Charge Christopher Combs, San Antonio Division. Three other individuals were also charged by the grand jury.
FOUR WINDS INDICTMENT
This indictment charges Uresti, age 53, of San Antonio, Four Winds Chief Executive Officer Stanley P. Bates, age 45, of San Antonio, and Four Winds consultant Gary L. Cain, age 60, of San Antonio, with one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering. The indictment also charges Uresti with five substantive counts of wire fraud, two counts of securities fraud; one count of engaging in monetary transactions with property derived from specified unlawful activity; and, one count of being an unregistered securities broker. The indictment also charges Bates with one count of wire fraud; two counts of securities fraud; and, three counts of engaging in monetary transactions with property derived from specified unlawful activity. The indictment also charges Cain with seven counts of engaging in monetary transactions with property derived from specified unlawful activity.
The indictment alleges that the defendants developed an investment Ponzi scheme to market hydraulic fracturing (fracking) sand for oil production. It further alleges that the defendants made false statements and representations to solicit investors in Four Winds. The defendants allegedly used funds from more recent investors to pay earlier investors and for personal expenses.
For each fraud related charge, the defendants face up to 20 years in federal prison upon conviction. For each money laundering charge, the defendants face up to ten years in federal prison upon conviction. Uresti faces up to 20 years in federal prison upon conviction of being an unregistered securities broker.
REEVES COUNTY INDICTMENT
This indictment charges Uresti and 44–year-old Vernon C. Farthing, III, of Lubbock, TX, with one count of conspiracy to commit bribery and one count of conspiracy to commit money laundering.
The indictment alleges that from January 2006 to September 2016, the defendants conspired with others to pay and accept bribes in order to secure a Reeves County Correctional Center medical services contract for Farthing’s company. The indictment specifically alleges that Farthing paid Uresti $10,000 a month as a marketing consultant and that half of that sum was then given to a Reeves County official for his support and vote to award the contract to Farthing’s company.
Upon conviction of the charges contained in this indictment, the defendants face up to five years in federal prison for conspiracy to commit bribery and up to 20 years in federal prison for conspiracy to commit money laundering.
It is anticipated that initial appearances for Uresti, Bates and Cain will be tomorrow at 11:00am before United States Magistrate Judge Henry Bemporad in San Antonio. Farthing’s initial appearance is expected to occur at 11:00am on Thursday in front of Judge Bemporad.
The FBI’s Pubic Corruption Task Force is conducting this investigation. The Task Force is comprised of investigators from the FBI, Internal Revenue Service-Criminal Investigation (IRS-CI), Texas Department of Public Safety (DPS) and the Peace Corps-Office of Inspector General. Assistant United States Attorneys Joseph E. Blackwell, William R. Harris and Mark Roomberg are prosecuting this case on behalf of the Government.
It is important to note that an indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.
Eight Individuals Charged in Connection with Armed Drug Distribution in OrlandoRead the Press Release
Orlando, Florida – Acting United States Attorney W. Stephen Muldrow announces the unsealing of a
criminal complaint charging eight individuals with conspiracy to distribute a controlled substance and distribution and possession with the intent to distribute a controlled substance. Eric Jean Gilles (Miami, 36), Jimmy Remy Fernetus (Miami, 30), Edson Gelin (Orlando, 39), Raymond Mike Ayap (Orlando, 41), Ronny Joseph (Orlando, 32), Cristobal Sotomayor-Cebollero (Orlando, 31), Kissinger St. Fleur (Orlando, 35), and Gerardson Norgaisse (Orlando, 32) each face a maximum penalty of 20 years in federal prison for each controlled substance charge. Additionally, Gilles, Fernetus, and Gelin each face an additional and consecutive term of five years, up to life, in federal prison for possessing a firearm in furtherance of a drug trafficking offense.According to the complaint, Gilles and Fernetus, members of a drug trafficking organization with ties to South Florida, were selling cocaine and “crack” cocaine from houses on 1621 Grand Street and 1427 18th Street, both located south of downtown Orlando. Gelin, who was stopped while traveling north towards Orlando on the Florida Turnpike on June 8, 2016, with two kilograms of cocaine, had also been selling cocaine at the house on Grand Street. All three--Gilles, Fernetus, and Gelin--were armed with handguns when purchases were made from the houses. Gelin also later sold cocaine from 2824 West Harwood Street in Orlando.
Ayap, Joseph, Sotomayor-Cebollero, St. Fleur, and Norgaisse each purchased distribution amounts of cocaine at one of the residences during the course of the investigation.
Gilles, Gelin, Ayap, and Joseph have been arrested and are being held in federal custody. Sotomayor-Cebollero is being held on unrelated state charges. Fernetus, St. Fleur, and Norgaisse have not yet been apprehended.
Search warrants have been executed at all three residences in connection with this investigation. Agents have recovered firearms, cocaine, and drug paraphernalia at all three locations, including three handguns, two assault rifles, and thousands of dollars in cash.
A complaint is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This investigation was conducted by the Drug Enforcement Administration, with assistance from the Metropolitan Bureau of Investigation and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It’s also part of an ongoing Organized Crime Drug Enforcement Task Forces (OCDETF) joint investigation. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply. It will be prosecuted by Assistant United States Attorney E. Jackson Boggs, Jr.
Dunkirk Couple Arrested on Cocain ChargesRead 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 Minerva Maestre, 49, and Hector Mercado-Torres, 23, both of Dunkirk, were arrested and charged by complaint with conspiracy to possess with intent to distribute and distribution of cocaine and crack cocaine; and maintaining a drug involved premises. The charges carry a mandatory minimum penalty of five years in prison, a maximum of 40 years and a $5,000,000 fine.
Assistant U.S. Attorney Timothy C. Lynch, who is handling the case, stated that according to the complaint, on April 28, 2017, the Southern Tier Regional Drug Task Force and the Drug Enforcement Administration executed a search warrant at 51 E. Second Street in Dunkirk, NY, which is the residence of the defendants. During the search, officers seized 18 packages of suspected crack cocaine and cocaine, plastic baggies, and $171,962 in cash. The complaint further alleges that defendants distributed crack cocaine from the residence.
The defendants made an initial appearance this afternoon before U.S. Magistrate Judge Jeremiah J. McCarthy and are being held pending a detention hearing.
The complaint is the result of an investigation by the Southern Tier Regional Drug Task Force, under the direction of Chautauqua County Sheriff Joseph Geraci; the Drug Enforcement Administration, under the direction of Special Agent-in-Charge James J. Hunt, New York Field Division; and the Dunkirk Police Department, under the direction of Chief David Ortolano.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Dominican National Pleads Guilty to Social Security FraudRead the Press Release
BOSTON – A Dominican national has pleaded guilty in federal court to using a stolen Social Security number in order to obtain a Massachusetts driver’s license.
Julio Cesar Baez-Mejia, 37, a Dominican national formerly residing in Lawrence, pleaded guilty today to one count of misuse of a Social Security number. U.S. District Court Judge George A. O’Toole scheduled sentencing for Sept. 12, 2017. Mejia-Baez is currently serving an 18-month sentence in the Lawrence Correctional Alternative Center for assault with a deadly weapon, breaking and entering and malicious destruction of property.
On Nov. 19, 2012, Baez-Mejia entered a Massachusetts branch of the Registry of Motor Vehicles and applied for a Massachusetts Class D Driver’s License under the name of an American citizen from Puerto Rico. On the application, the defendant listed the name, date of birth, and Social Security number of the American citizen as his own. Baez-Mejia then signed the license application and was issued a driver’s license under the stolen identity.
The charge of misuse of a Social Security number provides for a sentence of no greater than five years in prison, three years of supervised release and a fine of $250,000. Baez-Mejia will be subject to deportation upon the completion of his sentence. Sentences are imposed by a federal district court judge based on 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 Nicholas Soivilien of Weinreb’s Major Crimes Unit is prosecuting the case.
Dallas Man Arrested and Detained for Possessing a Firearm While Under the Influence of MarijuanaRead the Press Release
DALLAS — Adan Israel Salazar, 33, of Dallas, has been charged in a federal complaint with possession of a firearm by a user of a controlled substance, announced U.S. Attorney John Parker of the Northern District of Texas.
Salazar was arrested last week on the federal offense, and he made his initial appearance yesterday in federal court where U.S. Magistrate Judge David L. Horan ordered that he remain in federal custody pending trial.
According to the filed complaint, on April 26, 2017, Salazar attempted to drive through a security checkpoint at the Dallas Police Southwest Substation located at 4230 West Illinois Ave, Dallas, Texas. Police Officers at the scene smelled the odor of freshly burned marijuana coming from the vehicle. Salazar exited the vehicle wearing a “Guy Fawkes” mask on the side of his face and a camera around his neck. Salazar was behaving in an unusual fashion by crying and kneeling on his knees. Salazar stated to officers that he “had smoked only marijuana and all of the marijuana was gone. Salazar also stated that he had “come to the station to shoot up the station…to show the world that it can be done...” and... “I want to get rid of things that bother me…”
During a search of Salazar’s vehicle, two 9mm handguns were found in the console. Both pistols had fully loaded magazines and one pistol had one round in the chamber. There were also three additional magazines for a total of 5 magazines and 110 rounds of 9mm live ammunition. In addition, seven grams of marijuana was also found in Salazar’s vehicle contained in a glass mason jar in the backseat under a large “legalize marijuana” protest sign.
A federal complaint is a written statement of the essential facts of the offenses charged and must be made under oath before a magistrate judge. A defendant is entitled to the presumption of innocence until proven guilty. The U.S. Attorney’s office has 30 days to present the matter to a grand jury for indictment. The maximum statutory penalty for the offense as charged is 10 years in federal prison, a $250,000 fine.
The Dallas Police Department is investigating the case.
Assistant U.S. Attorney P.J. Meitl is in charge of the prosecution.
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Czech Republic and Slovak Republic Nationals Charged with Violating U.S. Export LawsRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, Leigh-Alistair Barzey, Special Agent in Charge of the DCIS Northeast Field Office, and Matthew Etre, Special Agent of HSI Boston, today announced that a federal grand jury in New Haven has returned two indictments charging citizens of the Czech Republic and the Slovak Republic with offenses related to the illegal export of U.S. military equipment.
Earlier today, the grand jury returned a two-count indictment alleging that, between June 2011 and November 2011, JOSEF ZIRNSAK, 38, of the Czech Republic, shipped from the U.S. to Germany an infrared dual beam aiming laser and a rifle scope, both of which are designated as defense articles on the U.S. Munitions List.
On May 3, 2017, the grand jury returned a five-count indictment alleging that, between May 2012 and June 2012, MARTIN GULA, also known as “Mark Welder,” 38, of the Slovak Republic, purchased and attempted to arrange the export of night vision goggles and an aviator night vision system from the U.S. to the United Kingdom. The indictment also alleges that, during the same time period, GULA used a false U.S. passport as proof of residency and citizenship in the U.S.
“The U.S. Attorney’s office in Connecticut is committed to working with our federal law enforcement partners to ensure that sensitive military items manufactured in the United States do not fall into the wrong hands,” said U.S. Attorney Deirdre Daly. “Willful violations of our nation’s export laws will be prosecuted to the full extent of the law.”
“The protection of sensitive U.S. military technology is a top priority for the Defense Criminal Investigative Service,” said DCIS Special Agent in Charge Barzey. “The charges announced today demonstrate the continued commitment of DCIS and its law enforcement partners to prevent our nation’s adversaries from obtaining sensitive military technology that could pose a grave threat to America’s armed forces.”
“These sophisticated technologies are highly sought after by America’s enemies,” said HSI Special Agent in Charge Etre. “They were developed to give the United States and its allies a distinct military advantage, which is why HSI will continue to aggressively target the individuals who illegally procure and sell these items.”
ZIRNSAK and GULA are each charged with two counts of violating the Arms Export Control Act, an offense that carries a maximum term of imprisonment of 20 years on each count GULA also is charged with two counts of export smuggling and one count of use of a false passport, offenses that carry a maximum term of imprisonment of 10 years on each count.
ZIRNSAK and GULA are currently being sought by law enforcement.
In January 2014, GULA was charged in the Central District of California with export related offenses. That indictment also is pending.
U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the Defense Criminal Investigative Service (DCIS) and Homeland Security Investigations (HSI). The case is being prosecuted by Assistant U.S. Attorney Henry K. Kopel
Cuban National Pleads Guilty to Alien SmugglingRead the Press Release
A Cuban national pled guilty yesterday to charges based on a foiled alien smuggling venture from the Bahamas to the United States.
Benjamin G. Greenberg, Acting United States Attorney for the Southern District of Florida, Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), William Gibbon, Director of the Miami Air and Marine Branch, U.S. Customs and Border Protection (CBP), and Rear Admiral Scott A. Buschman, Commander, 7th Coast Guard District (USCG), made the announcement.
Carlos Garcia-Legon, 54, of Cuba, appeared before U.S. District Judge Jose E. Martinez of the Southern District of Florida, where he pled guilty to fourteen counts of encouraging and inducing an alien to come to the United States illegally, in violation of Title 8, United States Code, Section 1324(a)(1)(A)(iv); one count of aiding and assisting the illegal entry of an aggravated felon, in violation of Title 8, United States Code Section 1327; one count of illegal re-entry into the United States, in violation of Title 8, United States Code, Section 1326(a) and (b)(1); and one count of failure to heave to, in violation of Title 18, United States Code, Section 2237(a)(1). Garcia-Legon faces a maximum statutory sentence of 30 years’ imprisonment. The defendant is scheduled to be sentenced before Judge Martinez in Miami on July 10, 2017 at 1:30 p.m.
According to court documents, CBP aircraft detected Garcia-Legon’s 25-foot cuddy cabin vessel near Bimini, Bahamas on February 7, 2017. CBP aircraft monitored Garcia-Legon’s vessel as it accepted the transfer of multiple passengers at sea from a second vessel. Garcia-Legon then piloted the vessel from the Bahamas to 10 miles east of Miami, Florida, a trip of approximately 35 nautical miles. When approached by CBP and USCG vessels, Garcia-Legon attempted to flee. After Garcia-Legon ignored commands to stop (or heave to) his vessel, CBP officers fired two warning shots forward of the vessel’s bow. After ignoring this warning, CBP ultimately stopped Garcia-Legon’s vessel by firing four shotgun rounds into the engines of the vessel.
With Garcia-Legon were fourteen passengers of various nationalities, including aliens from the People’s Republic of China, Jamaica, Sri Lanka, and Ecuador. One of the aliens aboard Garcia-Legon’s vessel was previously deported from the United States after a criminal conviction for an aggravated felony. A United States immigration judge had also previously ordered Garcia-Legon removed from the United States. The fourteen passengers and Garcia-Legon did not have authorization to enter the United States.
Mr. Greenberg commended the investigative efforts of ICE-HSI, CBP Office of Air and Marine Operations, and the USCG, and the assistance of CBP/U.S. Border Patrol and U.S. Citizenship and Immigration Services. This case is being prosecuted by Special Assistant U.S. Attorney Emily Rose and Assistant U.S. Attorney Daniel Cervantes.
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.
Court Orders Texas Businesses and Their Owners to Timely Pay Employment TaxesRead the Press Release
A federal court in McAllen, Texas ordered Idalia Padron and Nino’s Home Care Inc. to timely file the business’s federal employment and unemployment tax returns as they become due and pay in full the reported amounts due. The court also entered a money judgment against Nino’s Home Care for more than $2.7 million, which represents its past unpaid employment taxes.
The complaint filed by the government against Padron and Nino’s Home Care alleged that Padron of Edinburg, Texas, operates Nino’s Home Care, a home health care service provider located at 121 W. Samano Street in Edinburg, and that Nino’s Home Care failed to pay its employment taxes for 20 tax quarters between 2005 and 2016. The complaint also alleged that Padron paid herself more than $100,000 in salary in 2015, a year in which Nino’s Home Care failed to pay over to the Internal Revenue Service (IRS) more than $850,000 in employment taxes.
Employers like Nino’s Home Care have specific responsibilities regarding employment taxes. When a business pays its employees, it does not pay them directly all the money they earn. Every business with employees has a legal responsibility to withhold from employees’ paychecks, and pay over to the U.S. Treasury, income taxes and the employees’ share of social security and Medicare taxes. Businesses that fail to collect these employment taxes or pay them over to the Treasury are subject to a number of potential enforcement actions.
Civil injunctions like the one entered by the court against Nino’s Home Care are one example of employment tax enforcement. An injunction order requires the employer and its principal officers to timely deposit and pay employment taxes to the U.S. Treasury. These court orders also impose various other requirements and prohibitions, including the obligation to provide current notice of each deposit to the IRS, as well as restrictions on opening and operating new businesses and transferring or dissipating assets.
For example, a federal court in McAllen, Texas also barred Jorge Gallegos and Con Brazos Abiertos LLC from failing to pay the business’s employment and unemployment taxes, in addition to requiring Gallegos to notify the IRS of any new company he may come to own, manage, or work for in the next five years. The government’s complaint alleged that Con Brazos Abiertos is a home health care service provider located at 505 S. Texas Blvd. in Weslaco, Texas. The government alleged that Gallegos of Mercedes, Texas, is the president and chief of Con Brazos Abiertos, and the business failed to pay its employment taxes for numerous quarters between 2011 and 2016. In addition to enjoining Gallegos and Con Brazos Abiertos, the court entered a judgment of more than $1 million against Con Brazos Abiertos for its unpaid employment and unemployment taxes.
If an employer violates a civil injunction, the Justice Department’s Tax Division will seek to have the employer and responsible individuals held in contempt, and request appropriate sanctions, including incarceration, to bring the business into compliance with the court’s order. Where appropriate, the Department will also seek compensation, from the principal officers or the business, for the damage the contempt has caused. In addition to this relief, courts have ordered businesses to close their doors for continued failure to meet their employment tax obligations. For example, a federal court in Washington held two individuals in contempt of court for a consistent pattern of failing to meet the businesses’ employment tax obligations. The court later ordered the two to close their dental care businesses, cease operating as employers, and barred them from opening any new businesses where the two would serve as employers by June 8.
The Tax Division works with its partners in the IRS to force employers who are cheating to follow the law and collect what is owed. Since 2003, the Tax Division has obtained more than 100 permanent injunctions against employers and tens of millions of dollars in money judgments. For more information about civil and criminal employment tax enforcement efforts, visit the Tax Division’s website.
Council Bluffs Man Sentenced to 120 Months in Prison for Conspiracy to Distribute MethamphetamineRead the Press Release
COUNCIL BLUFFS, IA - On May 12, 2017, Frank Moises Torres, age 31, of Council Bluffs, Iowa, was sentenced by Senior United States District Court Judge Robert W. Pratt to 120 months in prison for conspiring to distribute methamphetamine, announced United States Attorney Kevin E. VanderSchel. Torres will also be required to serve a five-year term of supervised release following his imprisonment.
On January 4, 2017, Torres pleaded guilty to the charge and admitted that he participated in a conspiracy to distribute methamphetamine in the Southern District of Iowa beginning as early as October of 2016. A drug trafficking law enforcement investigation led to the charge in Omaha, Nebraska, Council Bluffs and southwest Iowa.
The Southwest Iowa Narcotics Enforcement Task Force, the Iowa Division of Criminal Investigation and the Pottawattamie County Attorney’s Office conducted the investigation. This case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
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Learn more about this release by calling Rachel J. Scherle at 515-473-9300, or by emailing her at [email protected].
Council Bluffs Man Sentenced to 120 Months in Prison for Conspiracy to Distribute MethamphetamineRead the Press Release
COUNCIL BLUFFS, IA - On May 11, 2017, Brandon Wayne Moore, age 40, of Council Bluffs, Iowa, was sentenced by Senior United States District Court Judge Robert W. Pratt to 120 months in prison for conspiring to distribute methamphetamine, announced United States Attorney Kevin E. VanderSchel. Moore will also be required to serve a five-year term of supervised release following his imprisonment.
On January 4, 2017, Moore pleaded guilty to the charge and admitted that he participated in a conspiracy to distribute methamphetamine in the Southern District of Iowa beginning as early as August of 2016. A drug trafficking law enforcement investigation led to the charge in Council Bluffs and southwest Iowa.
The Southwest Iowa Narcotics Enforcement Task Force, the Council Bluffs Police Department and the Iowa Division of Criminal Investigation conducted the investigation. This case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
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Learn more about this release by calling Rachel J. Scherle at 515-473-9300, or by emailing her at [email protected].
Cocoa Man Sentenced to 30 Years in Federal Prison for Child Sex Trafficking and Production of Child PornographyRead the Press Release
Orlando, Florida - U.S. District Judge Roy B. Dalton, Jr. has sentenced Kennedy Harris, Jr. (24, Cocoa) to 30 years in federal prison, followed by a life term of supervised release, for sex trafficking of a child by force, fraud, or coercion, and for producing child pornography. A federal jury found Harris guilty of both offenses on September 29, 2016.
According to testimony and evidence presented at trial, in January 2016, Harris took in the victim, a 16-year girl, after she ran away from home. Harris then took sexually suggestive photographs of the girl and advertised her for sex on Backpage.com. He also enticed the victim to engage in sexually explicit conduct for the purpose of photographing her. Over the course of approximately two weeks, the victim had sex with up to eight individuals per day, and gave the money to Harris. In exchange for her sex acts, Harris gave the girl crack cocaine nearly every day. On February 10, 2016, the victim was recovered by the Cocoa Police Department.
This case was investigated by Federal Bureau of Investigation, the Brevard County Sheriff’s Office, and the Cocoa Police Department. It was prosecuted by Assistant United States Attorney Tiffany L. Cummins.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Cockeysville Man Pleads Guilty to Production of Child Pornography and to CyberstalkingRead the Press Release
Baltimore, Maryland – Kevin Graham Conlon, age 30, of Cockeysville, Maryland, pleaded guilty on May 15, 2017, to production of child pornography and cyberstalking.
The guilty plea was announced by Acting United States Attorney for the District of Maryland Stephen M. Schenning; Special Agent in Charge Gordon B. Johnson of the Federal Bureau of Investigation, Baltimore Field Office; and Chief Terrence B. Sheridan of the Baltimore County Police Department.
According to his plea agreement, between 2014 and January 2017, Conlon induced four minor females and two minor males to take photographs and videos of themselves engaging in sexually explicit conduct and send those images and videos to Conlon using fictitious online social networks. Conlon created fictitious accounts using the identities of some of the victims, and distributed the child pornography he induced them to create in order to entice the others to produce and send him sexually explicit images and videos. Conlon also used various online accounts to engage in a course of conduct that was intended to cause the victims and their families substantial emotional distress.
Colon faces a mandatory minimum sentence of 15 years and up to 30 years in prison for production of child pornography and five years in prison for cyberstalking. U.S. District Judge J. Frederick Motz has scheduled sentencing for July 25, 2017 at 10:00 a.m.
Acting United States Attorney Stephen M. Schenning commended the FBI and Baltimore County Police Department for their work in the investigation. Mr. Schenning thanked Assistant U.S. Attorney Paul E. Budlow, who is prosecuting the federal case.
Charlton Woman Pleads Guilty to Oxycodone ConspiracyRead the Press Release
BOSTON – A Charlton woman pleaded guilty yesterday in federal court in Worcester to conspiracy to distribute oxycodone.
Jennifer Toledo, 45, pleaded guilty before U.S. District Court Judge Timothy S. Hillman, who scheduled sentencing for Sept. 12, 2017.
From August 2015 until April 2016, Toledo conspired with co-defendants John Tautenhan III and Amina Young to distribute oxycodone pills in and around Worcester County. On April 17, 2016, federal agents followed Toledo as she drove from Massachusetts to a restaurant in Yonkers, N.Y., to acquire oxycodone from Young. Five days later, on April 22, 2017, Toledo again drove to Yonkers to purchase additional oxycodone from Young. Investigators stopped the vehicle that Toledo was driving and seized over 500 oxycodone pills from Young and two other passengers.
Tautenhan pleaded guilty in April 2016 and is scheduled to be sentenced on July 12, 2017. Amina Young pleaded not guilty and is awaiting trial.
The charging statute provides for a sentence of up to 20 years in prison, a minimum of three years and up to a lifetime of supervised release and a fine of up to $1 million. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney William D. Weinreb and Michael Ferguson, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division, made the announcement. Assistant U.S. Attorney Greg A. Friedholm of Weinreb’s Worcester Branch Office is prosecuting the case.
The details contained in the charging document are allegations. The remaining defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Champaign Man Sentenced to 15 Years in Prison for Cocaine OffensesRead the Press Release
Urbana, Ill. – U.S. District Judge Colin S. Bruce has ordered a Champaign, Ill., man, Jerry Minnieweather, 38, to serve 15 years in federal prison for possession and distribution of cocaine and crack cocaine in 2015. Minnieweather, who appeared before Judge Bruce on May 15, was also ordered to remain on supervised release for eight years following completion of his prison sentence.
On Jan. 17, 2017, Minnieweather, last known address 2100 block of Southwood Drive, pled guilty to the four offenses charged in the indictment: distribution of cocaine (two counts); possession with intent to deliver 28 or more grams of crack cocaine; and, possession of cocaine. The drug offenses occurred in June and July 2015.
According to court documents, Minnieweather has two prior drug felony convictions in Champaign county, in 1996 and 1997. Minnieweather has remained in the custody of the U.S. Marshals Service since his arrest on July 15, 2015.
Supervisory Assistant U.S. Attorney Eugene L. Miller prosecuted the case. The Champaign Police Department and the Drug Enforcement Administration conducted the investigation.
Buffalo Man Pleads Guilty to Heroin ChargeRead 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 Hector Huertas, 49, of Buffalo, NY, pleaded guilty to conspiracy to possess with intent to distribute and distribution of heroin before U.S. District Judge Richard J. Arcara. The charge carries a maximum penalty of 20 years in prison and a $1,000,000 fine.
Assistant U.S. Attorney George C. Burgasser, who is handling the case, stated that between September 2014 and September 28, 2015, the defendant conspired with Daniel Molina-Rios, Orlando Rios, Jose Andujar, Luis Montanes, and others to distribute heroin on the West Side of Buffalo. The investigation utilized court ordered wiretaps as well as undercover purchases conducted by the New York State Police Community Narcotics Enforcement Team (CNET) and the Buffalo Police Department.
The 10 defendants charged in this case were street-level distributors or “runners” in a heroin trafficking ring operated by Daniel Molina-Rios who was arrested in June 2015. The organization acquired heroin from the New York City area for distribution in Buffalo but also had an alternate heroin source locally.
A total of 14 defendants have been indicted in this case, and two thus far have been convicted. Charges are pending against the remaining defendants. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The plea is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge James J. Hunt, New York Field Division; the New York State Police Community Narcotics Enforcement Team (CNET), under the direction of Major David Krause and Lieutenant Kevin Reyes, CNET West Commander; and the Buffalo Police Department, under the direction of Commissioner Daniel Derenda.
Sentencing is scheduled for August 30, 2017, at 12:30 p.m. before Judge Arcara.
Bethlehem Man Charged with Making False Statements in Connection with the Acquisition of FirearmsRead the Press Release
Jonathan William Vazquez, 37, of Bethlehem, PA, was charged today by indictment with fourteen counts of making false statements to federal firearms licensees announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about various dated between July 27, 2015 and March 22, 2016, Jonathan William Vazquez purchased sixteen firearms from three different federal firearms licensees, and in doing so, knowingly made false statements pertaining to information that the law requires the licensees keep.
If convicted of the charges, defendant faces a maximum sentence of 70 years’ imprisonment. He also faces a maximum period of supervised release of 3 years, a $3,500,000 fine, a $1,400 special assessment, restitution, and forfeiture of the firearms involved.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”), and is being prosecuted by Assistant United States Attorney Sarah T. Damiani.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Barbour County sentenced for illegal possession of firearmsRead the Press Release
WHEELING, WEST VIRGINIA – Roy Thomas Schroeder, 46, of Volga, West Virginia, was sentenced to 18 months incarceration for illegally possessing firearms, Acting United States Attorney Betsy Steinfeld Jividen announced.
Schroeder admitted to possessing two .22 caliber revolvers and a .22 caliber rifle after a protective order had been issued against him by the Barbour County Magistrate Court. He pled guilty to one count of “Unlawful Possession of a Firearm” in January 2016.
Assistant U.S. Attorney Stephen D. Warner prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms, and Explosives, the West Virginia State Police, and the Barbour County Sheriff’s Office investigated.
U.S. District Judge John Preston Bailey presided.
Armed Career Criminal Sentenced to More Than 17 Years in Prison for Possessing A FirearmRead the Press Release
Tampa, Florida – U.S. District Judge Steven D. Merryday today sentenced Jamal Smith (31, St. Petersburg) to 17 years and 6 months in federal prison for possessing a firearm as a convicted felon. The Court also ordered him to forfeit a firearm traceable to the offense. Smith pleaded guilty on February 27, 2017.
According to court documents, on September 1, 2015, a law enforcement officer observed a vehicle driven by Jamal Smith commit a traffic infraction. Smith initially fled in his vehicle, but later stopped and ran from the officer. A chase ensued, and Smith circled back to the vehicle and reached into the passenger side. The officer apprehended Smith and took him into custody. Law enforcement officers recovered a .45 caliber pistol from the glove box of the vehicle. At the time of the offense, Smith was a convicted felon and therefore was prohibited from possessing a firearm or ammunition under federal law. Due to his multiple prior convictions for violent felony or serious drug offenses, he qualified for an increased penalty as an Armed Career Criminal.
This case was investigated by the St. Petersburg Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant United States Attorneys Michael V. Leeman and Michael C. Sinacore.
This is another case prosecuted as a part of the Department of Justice’s “Project Safe Neighborhoods” Program - a nationwide, gun-violence reduction strategy. Acting United States Muldrow, along with Daryl R. McCrary, Special Agent in Charge, ATF, is coordinating the Project Safe Neighborhoods effort here in the Middle District of Florida in cooperation with federal, state, and local law enforcement officials.
Arlington Man Sentenced to 24 Months in Federal Prison after Pleading Guilty to a $1 Million Scheme to Defraud Home DepotRead the Press Release
DALLAS — Henry Lamon Spruiell, 46, of Arlington, Texas, was sentenced today by U.S. District Judge Sam A. Lindsay to serve 24 months in federal prison following his guilty plea in January 2017 to one count of using an unauthorized access device, announced U.S. Attorney John Parker of the Northern District of Texas.
Judge Lindsay ordered that he surrender to the Bureau of Prisons on July 11, 2017. Spruiell was also order to pay restitution in the amount of $1,139,076.00.
According to documents filed in the case, from June 2013 through January 2016, Spruiell, devised a scheme to defraud The Home Depot, Inc. of money and property.
Beginning in June 2013, Spruiell, or his associates, used a fraudulently obtained Home Depot Tax Exempt ID in Spruiell’s name at various Home Depot retail stores in the Northern District of Texas and elsewhere to obtain sales tax refunds in the form of store credits or cash from Home Depot. They did so by presenting copies of sales receipts acquired by Spruiell from both his own purchases as well as the purchases made by others who used identification information that sent these sales receipts to Spruiell’s email address.
After receiving the refunds, Spruiell, or his associates using Spruiell’s Home Depot Tax Exempt IDs, reused the same copies of the sales receipts by repeatedly presenting them to Home Depot retail stores to obtain repeat refunds on the same receipts. Spruiell obtained refunds at 18 different Home Depot retail stores. The Home Depot has estimated the total refunds in the scheme to be approximately $1,122,357.71 as of January 2016.
The United States Secret Service and Home Depot investigators investigated the case. Assistant U.S. Attorney Joseph Revesz prosecuted.
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Alvarado Man Sentenced to 150 Months in Federal Prison on Federal Child Pornography ConvictionRead the Press Release
DALLAS — A 53-year-old Alvarado, Texas, man, Jerry Wayne Smith, who pleaded guilty in January 2017 to one count of transporting and shipping child pornography, was sentenced this morning by U.S. District Judge David C. Godbey to 150 months in federal prison, announced U.S. Attorney John Parker of the Northern District of Texas.
“Far from a victimless crime, said U.S. Attorney Parker, trading in these sickening images fuels demand for more such images which, in turn, results in more innocent children being horribly victimized.”
According to documents filed in the case, the Dallas Internet Crimes Against Children (ICAC) Unit of the Dallas Police Department (DPD) received information that Smith, a City of Dallas employee, was reported by his co-workers as possessing and viewing child pornography while at his place of employment. DPD interviewed the co-workers, who confirmed they had seen Smith view child pornography on his Apple iPhone while in the employee break room at a City of Dallas facility on September 30, 2016 and again on October 3, 2016.
On October 4, 2016, DPD interviewed Smith at his place of employment. During the interview, Smith retrieved his phone and showed DPD that he browsed images of young children on the internet. A forensic review of the Apple iPhone showed multiple files depicting child pornography and a few video files depicting child pornography. In addition, the Kik application located on the Apple iPhone showed over 800 messages were observed in the application and several messaging strings were observed to have multiple attachments. The forensic review showed approximately 150 messaging exchanges and observed Smith trading files of child pornography in both individual and group messages.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The Federal Bureau of Investigation investigated. Assistant U.S. Attorney Shane Read prosecuted.
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Albion Doctor Sentenced to 15 Months in PrisonRead the Press Release
Dr. Horace Junior Davis Illegally Prescribed Opioid Painkillers and Billed Insurance Companies for Services he Never Rendered
GRAND RAPIDS, MICHIGAN — Acting U.S. Attorney Andrew Birge announced today that Doctor Horace Junior Davis, age 66, of Albion, Michigan, was sentenced to 15 months in federal prison for illegally prescribing opioid painkillers and committing healthcare fraud. U.S. District Judge Paul L. Maloney also ordered that Dr. Davis pay restitution and serve two years on supervised release after his prison sentence.
Dr. Davis, who was the owner of the Albion Center for Family Medicine, illegally prescribed the powerful opioid painkiller methadone to several patients in 2011 – 2013. He sought to make money from the illegal prescriptions by fraudulently billing healthcare benefit programs for the patients who had insurance coverage, or by collecting cash from the patients who didn’t have insurance coverage.
Judge Maloney noted that illegal prescriptions such as the ones Dr. Davis wrote are part of a larger opioid epidemic currently affecting the United States. According to the most recent data from the Centers for Disease Control, deaths from prescription opioids – drugs like oxycodone, hydrocodone, and methadone – have more than quadrupled since 1999. The CDC says that opioids were involved in 33,000 deaths in 2015 alone, and 91 people die every day from an opioid overdose.
Acting U.S. Attorney Andrew Birge said, "Whether it’s a supplier of heroin to street-corner dealers or a physician illegally writing prescriptions, my office will continue to hold accountable those who would profit from spreading the tragic curse of opioid addiction. Unfortunately, we will not end the epidemic through prosecution alone. My office has been and will continue to meet with education and health care professionals and those who may be able to make a difference to raise awareness of the danger of opioids and to discuss what they can do to save others from the awful consequences of spiraling addiction. Please contact us if you are interested in learning more."
This case was investigated by the Drug Enforcement Administration, the Albion Police Department, the Calhoun County Sheriff’s Department, and IRS Criminal Investigations. It was prosecuted by Assistant U.S. Attorney Clay Stiffler.
END
Akron man pleads guilty to shooting woman last summer in the Cuyahoga Valley National ParkRead the Press Release
An Akron man pleaded guilty to shooting a woman in the Cuyahoga Valley National Park last year, said David A. Sierleja, Acting U.S. Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office.
DeZay M. Ely, 28, is scheduled to be sentenced on Aug. 24. He pleaded guilty to attempted murder, discharging a firearm during a crime of violence and being a felon in possession of ammunition.
Ely attempted to kill a woman on July 3, 2016, by shooting her in the head, according to court documents.
“This defendant used a gun in a national park to try to murder a woman,” Sierleja said. “We will continue to use all the tools available to us to prosecute and punish violent criminals.”
Anthony said: “Law enforcement is pleased that Dezay Ely is accepting responsibility for the horrific crime he and his associates committed against an innocent victim. The collaboration between the FBI, the Cuyahoga Valley National Park Service, BCI and the public was invaluable to identifying and holding Ely accountable for this senseless crime.”
Attempted murder carries a maximum potential penalty of 20 years in prison. Discharging a firearm during a crime of violence carries a mandatory minimum consecutive term of 10 years in prison.
Raymond T. Moore III, 27, of Akron, was also involved in the shooting. His case remains pending.
The case is being prosecuted by Assistant U.S. Attorneys Kelly L. Galvin and Linda Barr following an investigation by the FBI, the Cuyahoga Valley National Park Police and the Ohio Bureau of Criminal Investigation.
Akron man ordered deported for hiding his activities during the war in the former YugoslaviaRead the Press Release
An Akron man was ordered deported for failing to disclose his involvement in a military unit engaged in war crimes in the former Yugoslavia, said David A. Sierleja, Acting U.S. Attorney for the Northern District of Ohio, and Steve Francis, HSI Detroit Acting Special Agent in Charge.
Ilija Josipovic, 59, previously pleaded guilty to two counts of possession of immigration documents procured by fraud.
U.S. District Judge Benita Pearson ordered Josipovic removed from the United States. He was also sentenced to eight months of house arrest.
“This defendant hid the fact that he was a member of a unit involved in atrocities in the former Yugoslavia,” Sierleja said. “He does not deserve the protections and rights of a U.S. citizen when his conduct flew in the face of our nation’s founding ideals.”
“The United States will never serve as a place of refuge for individuals seeking to distance themselves from their pasts,” Francis said. "HSI will continue to use its unique authorities to ensure that alleged war criminals are brought to justice. "
Josipovic, on Feb. 1, 2012, possessed a Permanent Resident Card in his name, which he knew to be procured by means of a false claim and statement while obtaining an Ohio driver’s license at the Ohio Bureau of Motor Vehicles office 7744, located at 1030 East Tallmadge Avenue in Akron. On Sept. 10, 2014, he possessed a Permanent Resident Card in his name, which he knew to be procured by means of a false claim and statement while at his residence in Akron, according to court documents.
In 2002, Josipovic omitted or failed to disclose his military service in the 6th Battalion, Zvornik Infantry Brigade, Army of the Republic of Srpska, which began around May 25, 1992 and continued until approximately 1996, according to court documents.
This case was prosecuted by Assistant U.S. Attorney Jason M. Katz following an investigation by the Department of Homeland Security, Homeland Security Investigations.
Acting Manhattan U.S. Attorney Charges Queens Music School Teacher with Sex Trafficking of MinorsRead the Press Release
Joon Kim, the Acting United States Attorney for the Southern District of New York, Darcel D. Clark, the Bronx County District Attorney, Angel M. Melendez, Special Agent-in-Charge of the New York Field Office of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (“HSI”), and James P. O’Neill, the Commissioner of the New York City Police Department (“NYPD”), announced today the arrest of OLIVER SOHNGEN, a/k/a “Helmuth Moss,” a/k/a “Stephan Weierbach.” SOHNGEN is charged with conspiracy to commit sex trafficking of minors, sex trafficking of minors, attempted sex trafficking of minors, and attempted inducement of minors to engage in sexual activity. SOHNGEN was arrested this morning and presented today before U.S. Magistrate Judge Gabriel W. Gorenstein in Manhattan federal court.
Acting Manhattan U.S. Attorney Joon H. Kim said: “Oliver Sohngen, a music school teacher, allegedly engaged in disturbing, predatory conduct: preying on minor girls for sex. He allegedly had sexual contact with minor girls at least twice, and attempted to engage in sex trafficking of girls under the age of 14. Together with our partners at HSI, NYPD, and the Bronx District Attorney, we are committed to working to protect our most vulnerable victims, children, from sexual exploitation.”
Bronx District Attorney Darcel D. Clark said: “This defendant came to the Bronx to allegedly engage in the dehumanizing treatment of girls ensnared in sex trafficking, even allegedly trying to arrange sexual encounters with girls as young as 8 years old. We have a duty to protect our vulnerable youth, and with our partners in the Manhattan U.S. Attorney’s Office, we will prosecute to the fullest extent of the law anyone who supports this cruel exploitation.”
HSI Special Agent in Charge Angel M. Melendez said: “It is unfathomable that Sohngen, who runs a music school, allegedly paid a pimp hundreds of dollars to arrange sexual encounters with underage girls. We at HSI remain committed to working together with our law enforcement partners to keep our children safe and ridding our neighborhoods of these dangerous sexual predators.”
Police Commissioner James P. O’Neill said: “The trafficking of minors for the purpose of sex is a deeply disturbing and reprehensible crime. We remain resolute in working along with our law enforcement partners to identify, apprehend, and prosecute those individuals who prey upon our most innocent victims. I commend the detectives and agents involved in this investigation and the US Attorney’s Office, Southern District for their efforts that resulted in these arrests.”
According to the allegations in the Complaint[1]:
Between March 2013 and November 2013, SOHNGEN exchanged text messages with a co-conspirator to arrange paid sexual encounters with minor girls ranging in age from 8 to 17. On at least two occasions, SOHNGEN engaged in sexual contact with minor girls at the co-conspirator’s apartment in the Bronx, New York. In addition, between November 2015 and January 2016, SOHNGEN participated in recorded telephone conversations with an undercover NYPD officer who was posing as a 15-year-old girl. SOHNGEN proposed to meet with the purported 15-year-old girl in order to engage in sexual conduct.
* * *
OHNGEN, 52, of Queens, New York, is charged with one count of conspiracy to engage in sex trafficking of minors, which carries a maximum term of life in prison, as well as two counts of sex trafficking of minors under the age of 18, each which carries a mandatory minimum term of 10 years in prison and a maximum of life in prison; three counts of attempted sex trafficking of minors under the age of 14, each of which carries a mandatory minimum term of 15 years in prison and a maximum of life in prison; and two counts of attempted inducement of minors under the age of 18 to engage in sexual activity, each of which carries a mandatory minimum term of 10 years in prison and a maximum of life in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Kim praised the outstanding investigative work of HSI and the NYPD, and expressed gratitude for the efforts of HSI’s New York Trafficking in Persons Unit and the NYPD’s Vice Enforcement Division Major Case Team. Mr. Kim also expressed gratitude to the Bronx County District Attorney’s Office for its partnership in this investigation.
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorneys Frank Balsamello and Michael Krouse are in charge of the prosecution, with assistance from Bronx County Assistant District Attorney Meagan Powers.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
15 May 2017
Woodlawn Woman Sentenced on Methamphetamine ChargeRead the Press Release
Roanoke, VIRGINIA – Acting United States Attorney Rick A. Mountcastle announced today the sentencing of a local woman on a federal methamphetamine charge.
Jessica Machelle Garlic, 30, of Woodlawn, Va., previously pled guilty in the United States District Court for the Western District of Virginia in Roanoke to one count of conspiring to possess with the intent to distribute and to distribute 5 grams or more of methamphetamine. Today in District Court, Garlic was sentenced to 65 months in federal prison.
The investigation of the case was conducted by the Drug Enforcement Administration, the Virginia State Police, the Franklin County Sheriff’s Office, the Galax Police Department, the Carroll County Sheriff’s Office and the Grayson County Sheriff’s Office. Assistant United States Attorney Ashley Neese prosecuted the case for the United States.
Western District’s U.S. Attorney’s Office remembers fallen law enforcement officers during National Police Week 2017Read the Press Release
SHREVEPORT/LAFAYETTE/ALEXANDRIA/LAKE CHARLES/MONROE, La.: Members of the public join with law enforcement across the country for National Police Week – May 13th through May 21st – to honor law enforcement officers who made the ultimate sacrifice, as well as the family members, friends and fellow officers they left behind.
“National Police Week is a way we can recognize the courage and dedication of law enforcement officers,” said Acting U.S. Attorney Alexander C. Van Hook. “We should never forget the sacrifices of law enforcement who risk their lives every day to keep us safe and bring violators of the law to justice. We especially remember those this week who lost their live in the line of duty in the Western District of Louisiana.”
This year, the names of officers killed the line of duty in 2016 and some prior years were added to the National Law Enforcement Officers Memorial in Washington, D.C., during the 29th Annual 2017 Candlelight Vigil on the evening of May 13th. These names include officers who were killed during 2016 and officers who died in previous years who have not been previously added to the Memorial. The fallen officers of 2016 include three members of the law enforcement community in the Western District of Louisiana:
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Derrick Morial Mingo, Winnsboro Police Department, who died June 4, 2016;
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David Kyle Elahi, Sterlington Police Department, who died July 3, 2016; and
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Shannon Matthew Brown, Fenton Police Department, who died August 13, 2016.
To assist local public safety officers in the work that they do, the U.S. Attorney’s Office offers a number safety and survival training throughout the year. The Western District’s Law Enforcement Community Coordinator is Mike Campbell, a former Shreveport Police Chief, who oversees the course curricula and sessions. The courses are open to federal, state, local, military and tribal law enforcement officers.
National Police Week is a collaborative effort of many organizations dedicated to honoring America’s law enforcement community.
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Waldorf Man Pleads Guilty to Illegal Possession of Unregistered Machine Guns, Unregistered Short-Barreled Rifles and Destructive Devices, and Possession of Child Pornography ChargesRead the Press Release
Greenbelt, Maryland – Caleb Andrew Bailey, age 31, of Waldorf, Maryland, pleaded guilty in federal court today to illegal possession of unregistered machine guns, unregistered short-barreled rifles, unregistered destructive devices, and possession of child pornography charges.
The guilty plea was announced by Acting United States Attorney for the District of Maryland Stephen M. Schenning; Special Agent in Charge Daniel L. Board Jr. of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Postal Inspector in Charge Robert B. Wemyss of the U.S. Postal Inspection Service - Washington Division; and Charles County Sheriff Troy Berry.
According to the plea agreement, on May 5, 2016, Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”) Special Agents executed federal search warrants at adjoining properties in Waldorf, Maryland associated with the Defendant. At the Defendant’s residence, law enforcement located, among other items, an underground bunker containing machine guns, machine gun manufacturing parts and devices, firearms, explosives, unregistered short-barreled rifles and destructive devices; covert recording devices; and child pornography on electronic devices seized inside and outside the residence, including one electronic device located within the underground bunker and other items moved from the Defendant’s bedroom at his residence and hidden in the woods by a minor victim at the direction of Bailey. At his parents’ residence, in the Defendant’s bedroom, law enforcement recovered an electronic device that contained internet searches indicative of child pornography.
During the execution of the search warrant on May 5, 2016, a 17-year-old minor was present at Bailey’s residence. The minor admitted that Bailey instructed the minor to remove a Panasonic Toughbook laptop, a Sony camera, and a Seagate external hard drive from Bailey’s residence and cover them with leaves by a footbridge in the woods behind the residence. Law enforcement recovered these items.
On May 17, 2016, the Department of Homeland Security, Homeland Security Investigations conducted a forensic analysis of Bailey’s electronic devices. The forensic analysis revealed that Bailey used hidden cameras to surreptitiously record videos of the victims in the bathroom of Bailey’s recreational vehicle, with the focus of those videos on the victims’ genitals. Bailey also physically transported the hidden cameras outside of Maryland to various hotels at which he stayed with the victims while competing in ATV races. In total, Bailey recorded over 100 videos capturing the genitals of the victims between March 2014 and January 2016. Bailey also created screen captures of portions of some of the videos that Bailey recorded of the victims. The screen captures depict the victims nude with their genitals exposed. Bailey saved these videos and video screen captures on the Seagate hard drive recovered during the execution of the search warrant at the Defendant’s residence on May 5, 2016. The forensic analysis also revealed that Bailey possessed other images and videos of child pornography on various electronic devices, including a hard drive located within his bunker, that do not appear to have been produced by him, including depictions of prepubescent minors and depictions of sadistic or masochistic conduct involving minors (bondage). Bailey’s collection of child pornography included more than 280 images and 54 videos depicting children engaged in sexually explicit conduct.
As part of his plea agreement, Bailey must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
Bailey and the government have agreed that if the Court accepts the plea agreement Bailey will be sentenced to between 120 and 324 months in prison. U.S. District Judge Paul W. Grimm has scheduled sentencing for November 30, 2017 at 9:00 a.m.
Acting United States Attorney Stephen M. Schenning commended ATF Baltimore Field Division, HSI Baltimore, U.S. Postal Inspection Service - Washington Division and Charles County Sheriff’s Office for their work in the investigation. Mr. Schenning thanked Assistant U.S. Attorneys Jennifer R. Sykes, Kristi N. O’Malley, and Thomas P. Windom, who are prosecuting the case.
Vitamin Shop Owner Guilty of Selling Misbranded Drugs and Controlled SubstanceRead the Press Release
CORPUS CHRISTI, Texas – A 33-year-old resident of Corpus Christi has pleaded guilty to possessing a controlled Substance with the intent to distribute and one count of receiving a misbranded drug in interstate commerce, announced Acting U.S. Attorney Abe Martinez.
Elias Trevino Jr. was one of the owners of X2Zero, a store selling dietary supplements online and through stores located in Corpus Christi. The Food and Drug Administration (FDA) determined a number of products sold there as “herbal weight loss supplements” were found to contain misbranded or unapproved foreign drugs.
In 1997, the (FDA) approved a prescription drug containing sibutramine under the trade name Meridia for the management of obesity. In October 2010, the FDA requested the Meridia marketer to withdraw the drug from the United States market due to the health risks associated with sibutramine, including an increased risk of heart attack, stroke and death. On Dec. 21, 2010, at the request of the manufacturer, the FDA withdrew its approval of Meridia. Since that time, no drug containing sibutramine has been approved for human use in the United States.
At today’s hearing before Senior U.S. District Judge John D. Rainey, Trevino admitted he knowingly possessed and sold diet drugs containing sibutramine. He acknowledged that he imported the drugs from China and sold them through both the X2Zero store in Corpus Christi and on the Internet in violation of the federal Food, Drug and Cosmetic Act.
Sentencing has been set for Aug. 14, 2017, 2017. At that time, Trevino faces up to five years in federal prison and a possible $250,000 maximum fine for the controlled substance violation as well as one year in prison and an additional $100,000 maximum fine for violating the Food, Drug, and Cosmetic Act.
He was permitted to remain on bond pending that hearing.
The FDA - Office of Criminal Investigations conducted the investigation. Assistant U.S. Attorney Robert D. Thorpe Jr. is prosecuting the case.
University of the Nations CFO Pleads Guilty to Wire FraudRead the Press Release
HONOLULU – Pablo M. Rivera, age 41, of Honolulu, Hawaii, pled guilty today in federal court to one count of wire fraud. According to court documents, from July 2014 to January 2017, Rivera, the Chief Financial Officer of the University of the Nations (UOFN), defrauded UOFN of $3,096,241 through a scheme that involved Rivera submitting false invoices for construction related projects on UOFN’s campus.
Elliot Enoki, Acting United States Attorney for the District of Hawaii, said that according to court documents and information presented in court, UOFN tasked Rivera with hiring and paying contractors to do various jobs on UOFN’s Kailua-Kona campus. Rivera sent a series of invoices to UOFN which purported to reflect the true costs and labor charges of work performed by contractor KJ Walk, Inc. (KJ Walk), but in reality were false and altered KJ Walk invoices. The altered invoices falsely inflated the actual costs and wages for work performed by KJ Walk. UOFN paid the invoices, resulting in the transfer of funds from UOFN’s checking account to a KJ Walk corporate account that was controlled by both KJ Walk and Rivera. Once the money was transferred to the KJ Walk corporate account, Rivera made withdrawals from the KJ Walk account.
Rivera will be sentenced on August 28, 2017, by United States District Judge Susan Oki Mollway, and will face a maximum penalty of 20 years imprisonment. Rivera has agreed to repay UOFN $3,096,241.
The case was investigated by the Federal Bureau of Investigation. The prosecution was handled by Assistant U.S. Attorney Michael Nammar.
Two Individuals, Company Plead Guilty to Violations of Clean Air Act Involving AsbestosRead 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 two individuals and one company pleaded guilty before U.S. District Judge Richard J. Arcara to violations of the Clean Air Act. Sean P. Doctor, 50, of Buffalo, NY pleaded guilty to making a false statement under the Clean Air Act. The charge carries a maximum penalty of two years in prison and a fine of $250,000. Raj Chopra, 53, of Grand Island, NY, pleaded guilty to accessory after the fact to a false statement under the Clean Air Act, which carries a maximum penalty of one year in prison and a fine of $125,000. Chopra’s company, Comprehensive Employee Management, (CEM), located on Grand Island, pleaded guilty to making a false statement under the Clean Air Act. That charge carries a maximum penalty of five years’ probation and a $500,000 fine.
Assistant U.S. Attorney Aaron J. Mango, who is handling the case, stated that CEM, an environmental consulting company located at 1815 Love Road on Grand Island, provided consulting services to defendant Doctor and his asbestos abatement company, S.D. Specialty Services, LLC. Pursuant to federal regulations, all owners or operators of an asbestos abatement project regulated under the Clean Air Act, must maintain a waste shipment manifest to include the name of the owner/operator; the name of the generator; and the date the asbestos was transported. The information enables the Environmental Protection Agency’s, which enforces the Clean Air Act and associated regulations, to properly and timely investigate suspected violations of the Clean Air Act.
From December 2009, to January 2010, employees of S.D. Specialty performed asbestos abatement work at the Roosevelt Park Shelter in Buffalo, which was subject to regulations of the Clean Air Act. During the project, S.D. Specialty employees removed asbestos from the Roosevelt Park Shelter and transported the material to a waste container at CEM on Grand Island.
On March 11, 2010, defendants Doctor and CEM executed an asbestos waste manifest which falsely indicated that asbestos had been transported to CEM from the Roosevelt Park Shelter on that date. In truth and in fact, such asbestos had been transported to, and stored at, the Grand Island location prior to March 11, 2010. As such false statement was included in the shipping manifest created when a local waste disposal company retrieved the waste container at CEM on March 11, 2010, such false statement became part of a record required to be maintained under the Clean Air Act.
In addition, on April 28, 2011, an inspection of the Roosevelt Park Shelter revealed asbestos was improperly left behind by employees of S.D. Specialty.
The plea is the result of an investigation on the part of Special Agents of the U.S. Environmental Protection Agency - Criminal Investigation Division, under the direction of Special Agent-In-Charge, Vernesa Jones-Allen; and Investigators of the New York State Department of Environmental Conservation Police, BECI, under the direction of Captain Frank Lauricella. Additional assistance was provided by the New York State Department of Labor, Asbestos Control Bureau.
Sentencing is scheduled for August 28, 2017, at 12:30 p.m. before Judge Arcara.
Two Alien Smugglers Head to Federal PrisonRead the Press Release
CORPUS CHRISTI, Texas – Two Alvin residents have been ordered to prison for their involvement in transporting undocumented immigrants, announced Acting U.S. Attorney Abe Martinez.
Sarah Lynn Reyes, 23, and Martin Thomas Contreras, 25, pleaded guilty Feb. 21, 2017, to transporting an alien in reckless disregard of his citizenship. Reyes also admitted to fleeing a Customs and Border Protection (CBP) checkpoint.
Today, U.S. District Judge John Rainey handed both defendants an 18-month sentence. He expressed his hope that the sentence will serve as a deterrent to others who may be thinking about transporting undocumented immigrants. Both will also be required to serve a term of two years of supervised release following completion of their prison terms.
On Dec. 21, 2016, both arrived at the CBP checkpoint on Texas Hwy 77 south of Santa driving a four-door Chevrolet Silverado pickup truck with their three young children in the back seat. Reyes was driving and Contreras was located in the front passenger seat. Officers observed a large lump on the backseat floorboard covered with a blanket. At that time, a canine service agent alerted to the vehicle, which prompted them to refer the vehicle to the secondary inspection area.
Reyes did not comply and accelerated away. A chase ensued for approximately 75 miles, during which time Reyes drove at speeds of up to 100 miles per hour disregarding stop signs and red lights. She was eventually apprehended in Corpus Christi. At that time, authorities discovered an undocumented immigrant from Mexico laying under the blanket on the floorboard where the children were seated.
At the hearing today, Judge Rainey noted that the driving conduct was extremely dangerous to the young children in the car, other motorists and law enforcement and that it was one of the longest high-speed chases he has seen.
The defendants were permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
U.S. Border Patrol conducted the investigation. Assistant Attorney Jon Muschenheim prosecuted the case.
Three Laredo Men Convicted of Trafficking DrugsRead the Press Release
LAREDO, Texas – Three Laredo men have entered guilty pleas for their roles in a conspiracy to traffic drugs from Laredo to the Dallas area via the use of tractor trailers, announced Acting U.S. Attorney Abe Martinez.
Armando Eloy Gutierrez, 38, Javier Mota Villanueva, 33 and Leopoldo Rodriguez III, 25 entered pleas of guilty to conspiracy to posses with the intent to distribute marijuana.
In August 2013, authorities identified a drug trafficking organization responsible for the transportation and distribution of kilogram quantities of marijuana from Laredo to the Dallas area. Gutierrez was in charge of finding warehouses for the organization to use and then soliciting shipping companies to transport trailers with marijuana and cover with loads of merchandise. He would also act as a scout by following the drivers through checkpoint. Once through, he would then drive with others to the Dallas or Fort Worth area to assist in receiving and unloading the drugs.
Mota-Villanueva worked at the warehouses. He wrapped the marijuana, moved pallets and loaded the drugs onto trailers. He would also travel to Dallas along with Gutierrez.
Rodriguez was tasked with wrapping marijuana and assisting with loading of narcotics onto trailers at a warehouse.
The investigation revealed three warehouse in Laredo that the organization used at different periods from on or about September 2013 to on or about July 31, 2014. They were located on the 1800 block of Aduanales, 200 block of Corpus Christi Street and the 1600 block of West Calton. Three separate marijuana loads were seized that originated from each one of the three warehouses, totaling more than 1600 kilograms.
U.S. Magistrate Judge Scott Hacker accepted the pleas today. Sentencing will be before U.S. District Judge George P. Kazen at a date to be determined. Due to the amounts for which they are held accountable, Gutierrez and Villanueva face a minimum 10 years and up to life in federal prison. Rodriguez faces a minimum of five and up to 40 years imprisonment.
Gutierrez and Mota will remain in custody, while Rodriguez was permitted to remain on bond pending sentencing.
The Drug Enforcement Administration conducted the investigation with the assistance of task force members of the Webb County District Attorney’s Office and the Laredo Police Department. Assistant U.S. Attorney Mary Lou Castillo is prosecuting the case.
Three Indicted in $2.7 Million Bank Fraud SchemeRead the Press Release
BOSTON – A Rockland couple has been arrested and charged today with engaging in a scheme to embezzle more than $2.7 million from Bank of America using fraudulent donations to non-profit organizations. A third person, who was previously charged in a criminal complaint, was also charged in the indictment unsealed today.
Palestine Ace, aka Pam Ace, 45, a former Senior Vice President of Bank of America’s Global Wealth & Investment Management Division; her husband, Jonathan R. Ace, 46; and Brianna Alexis Forde, 35, of Boston, were each indicted on one count of conspiracy to commit bank fraud and wire fraud. In addition, Palestine Ace was also indicted on 12 counts of bank fraud and four counts of wire fraud; Jonathan Ace was also charged with two counts of wire fraud and one engaging in an unlawful monetary transaction; and Forde was also indicted on two counts of wire fraud.
According to the indictment, from approximately October 2010 to April 2015, the defendants engaged in an embezzlement and kickback scheme to defraud Bank of America of approximately $2.7 million using fraudulent donations to non-profit organizations. As part of the scheme, Palestine Ace used her position as a Senior Vice President at Bank of America to misappropriate funds from a marketing budget and transfer the money to non-profit organizations. Specifically, Palestine Act allegedly authorized 75 transactions, each under $50,000, to non-profit organizations in Boston and Atlanta. Then, the defendants, either directly or indirectly, informed the non-profit organizations that a substantial portion of the donated funds must be returned in order to ensure that Bank of America would continue to fund the organization. The non-profit organizations either wrote a check to Jonathan Ace or Forde, or they returned funds to a Bank of America account, to which the defendants had access. On various occasions, Jonathan Ace pressured the recipients of the donated funds to return a higher percentage of the funds to him, by using intimidation and threats of public humiliation.
The indictment also alleges that Palestine and Jonathan Ace used a portion of the funds they embezzled from Bank of America to support their lifestyle and pay for personal expenses, including lavish birthday parties and the purchase of a $17,000 Kawasaki motorcycle.
The charges of wire fraud and bank fraud each provide for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000. The charge of unlawful monetary transaction provides for a sentence of no greater than 10 years in prison, two 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.
Acting United States Attorney William B. Weinreb; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Boston Police Commissioner William B. Evans; Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Shelly Binkowski, Inspector in Charge of the U.S. Postal Inspection Service, made the announcement today. Assistant U.S. Attorney Neil J. Gallagher of Weinreb’s Economic Crimes Unit is prosecuting the case.
The details contained in the indictment are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Tampa Man Sentenced in Wire Fraud Scheme Involving Fraudulent RefundsRead the Press Release
Tampa, Florida – U.S. District Judge Elizabeth A. Kovachevich has sentenced Rida Saed (58, Tampa) to 12 months and 1 day in federal prison for his role in a scheme involving the filing of fraudulent income tax returns. As part of his sentence, the Court also ordered Saed to pay $51,838.91 in restitution to the Internal Revenue Service. He pleaded guilty on January 19, 2017.
According to court documents, Saed and others processed debit cards at their store, Three Brothers Market in St. Petersburg, knowing that they contained proceeds from the filing of fraudulent income tax returns. Saed and others processed those cards through the third-party credit processor that handled credit transactions for the market. They kept a portion of the proceeds for their services and returned the majority of the funds to the undercover agents who had presented them for cashing. The total amount of fees that Saed and the others kept from these transactions was $51,838.91.
This case was investigated by the Internal Revenue Service - Criminal Investigation and the Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Jay L. Hoffer.
Simpsonville Woman Pleads Guilty to Passing Counterfeit CurrencyRead the Press Release
Columbia, South Carolina ---- United States Attorney Beth Drake stated today that Jessica A. Dishinger, age 22, of Simposonville, pled guilty today in federal court in Anderson, to passing counterfeit currency, a violation of Title 18, United States Code, Section 472. United States District Judge J. Michelle Childs, of Columbia, accepted the plea and will impose sentence after she has reviewed the presentence report which will be prepared by the U.S. Probation Office.
Evidence presented at the change of plea hearing established that in 2016 and 2017, Dishinger passed counterfeit money at various businesses in the upstate. She targeted grocery stores and department stores. She used the counterfeit money to purchase gift cards and other items.
Ms. Drake stated the maximum penalty Dishinger can receive is a fine of $250,000 and/or imprisonment for 20 years, plus a special assessment of $100.
The case was investigated by agents of the U.S. Secret Service, the Greenville County Sheriff’s Office, the Greenville City Police Department, the Greer Police Department, the Simpsonville Police Department, and the Easley Police Department. Assistant United States Attorney Bill Watkins of the Greenville office handled the case.
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Printing and Packaging Business Owner Convicted of Trafficking in Counterfeit Veterinary LabelsRead the Press Release
HOUSTON – A California businessman has admitted to directing the manufacture of counterfeit labels and sending them to Houston, announced Acting U.S. Attorney Abe Martinez.
Michael Chihwen Wang, 49, of Buena Park, California, was the vice president of CYU Lithographics Inc. doing business as Choice Lithographics in Buena Park. Between July 2015 and December 2016, Wang directed the manufacture of counterfeit trademarked Frontline, Frontline Plus and Merial veterinary product labels and shipped them to Houston.
Merial, Frontline and Frontline Plus are trademarks registered by Merial - an animal health company located in Duluth, Georgia, which manufactures and sells pharmaceutical drugs and pesticides for animals.
Wang intentionally caused the manufacture of counterfeit labels and packaging of copyrighted or trademarked items to make packaging appear legitimate. The labels were delivered to a warehouse as part of an undercover investigation. No actual veterinary products were involved in this case.
U.S. District Judge Kenneth M. Hoyt has set sentencing for July 24, 2017, at which time Wang faces up to 10 years in prison and/or a possible $2 million fine. Wang was permitted to remain on bond pending that hearing.
The U.S. Food and Drug Administration-Office of Criminal Investigations and the Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation. Assistant U. S. Attorney Daniel C. Rodriguez is prosecuting the case.