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Thursday 23 March 2017
ZTE Corporation Pleads Guilty for Violating U.S. Sanctions by Sending U.S.-Orgin Items to IranRead the Press Release
WASHINGTON – ZTE Corporation pleaded guilty today to conspiring to violate the International Emergency Economic Powers Act (IEEPA) by illegally shipping U.S.-origin items to Iran, obstructing justice and making a material false statement.
Attorney General Jeff Sessions of the U.S. Department of Justice, Acting Assistant Attorney General Mary B. McCord for National Security, U.S. Attorney John R. Parker for the Northern District of Texas and Assistant Director Bill Priestap for the FBI’s Counterintelligence Division made the announcement today. The plea was entered before U.S. District Judge Ed Kinkeade.
Specifically, ZTE pleaded guilty to one count of conspiring to unlawfully export in violation of the IEEPA, one count of obstruction of justice and one count of making a material false statement. ZTE agreed to pay a fine in the amount of $286,992,532 and a criminal forfeiture in the amount of $143,496,266, and submit to a three-year period of corporate probation, during which time an independent corporate compliance monitor will review and report on ZTE’s export compliance program.
As previously announced on March 7, at the time that ZTE agreed to plead guilty, the Corporation simultaneously reached settlement agreements with the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) and the U.S. Department of the Treasury’s Office of Foreign Assets Control. In total ZTE has agreed to pay the U.S. Government $892,360,064. The BIS has suspended an additional $300,000,000, which ZTE will pay if it violates its settlement agreement with the BIS.
According to plea documents filed in the case, between January 2010 and January 2016, ZTE, either directly or indirectly through a third company, shipped approximately $32,000,000 of U.S.-origin items to Iran without obtaining the proper export licenses from the U.S. government. In early 2010, ZTE began bidding on two different Iranian projects. The projects involved installing cellular and landline network infrastructure. Each contract was worth hundreds of millions of U.S. Dollars and required U.S. components for the final products.
In December 2010, ZTE finalized the contracts with Iranian customers. The contracts were signed by four parties: the Iranian customer, ZTE, Beijing 8 Star and ZTE Parsian (ZTE’s subsidiary in Iran). Court documents explain that ZTE identified Beijing 8 Star (8S) as a possible vehicle for hiding its illegal shipments of U.S. items to Iran. It intended to use 8S to export U.S.-origin items from China to ZTE customers in Iran. As part of this plan, ZTE supplied 8S with necessary capital and took over control of the company.
Under the terms of the Iran contracts, ZTE agreed to supply the “self-developed equipment,” collect payments for the projects and manage the whole network. ZTE Parsian was to provide locally purchased materials and all services. 8S was responsible for “relevant third-party equipment,” which primarily meant parts that would be subject to U.S. export laws. ZTE intended for 8S to be an “isolation company,” that is, ZTE intended for 8S (rather than ZTE) to purchase the embargoed equipment from suppliers and provide that equipment under the contract in an effort to distance ZTE from U.S. export-controlled products, and insulate ZTE from U.S. export violations. However, 8S had no purchasing or shipping history and no real business reputation.
Ultimately, although 8S was a party to the contracts, ZTE itself purchased and shipped the embargoed goods under the contract. In its shipping containers, it packaged the U.S. items with its own self-manufactured items to hide the U.S.-origin goods. ZTE did not include the U.S. items on the customs declaration forms, though it did include the U.S.-origin items on the packing lists included inside of the shipments.
In early 2011, when ZTE determined that the use of 8S was insufficient to hide ZTE’s connection to the illegal export of U.S.-origin goods to Iran, senior management of ZTE ordered that a company-level export control project team study, handle and respond to the company’s export control risks. In September 2011, four senior managers signed an Executive Memo, which proposed that the company identify and establish new “isolation companies” that would be responsible for supplying U.S. component parts necessary for projects in embargoed countries. The isolation companies would conceal ZTE’s role in the transshipment scheme and would insulate ZTE from export control risks.
In March 2012, Reuters published an article regarding ZTE’s sale of equipment to Iran. In response, ZTE made a decision to temporarily cease sending new U.S. equipment to Iran. By November 2013, however, ZTE had resumed its business with Iran. Beginning in July 2014, ZTE began shipping U.S.-origin equipment to Iran once again without the necessary licenses.
Instead of using 8S, however, ZTE identified a new isolation company. ZTE signed a contract with the new isolation company, which in turn signed contracts with the two Iranian customers. According to the new scheme, ZTE purchased and manufactured all relevant equipment – both U.S.-origin and ZTE-manufactured – and prepared them for pick-up at its warehouse by the new isolation company. The new isolation company then shipped all items to the Iranian customers. Shipments to Iran continued from January 2014 through January 2016.
Despite its knowledge of an ongoing grand jury investigation into its Iran exports, according to plea documents, ZTE took several steps to conceal relevant information from the U.S. government. It further took affirmative steps to mislead the U.S. government. In the summer of 2012, ZTE asked each of the employees who were involved in the Iran sales to sign nondisclosure agreements in which the employees agreed to keep confidential all information related to the company’s U.S. exports to Iran.
During meetings throughout late 2014, late 2015 and early 2016, outside counsel for ZTE, unaware that the statements ZTE had given to counsel for communication to the U.S. Government were false, represented to the DOJ and federal law enforcement agents that ZTE had stopped doing business with Iran and therefore was no longer violating U.S. export laws. Similarly, on July 8, 2015, in-house counsel for ZTE accompanied outside counsel in a meeting with the DOJ and federal law enforcement agents and reported that ZTE was abiding by U.S. laws. That statement was also false.
ZTE also hid data related to its resumed illegal sales to Iran from a forensic accounting firm hired by defense counsel to conduct an internal investigation into the company’s Iran sales. ZTE knew the forensic accounting firm was reviewing its systems and knew that the analysis was being reported to the DOJ and U.S. law enforcement. To avoid detection of its 2013-2016 resumed illegal sales to Iran, ZTE formed the “contract data induction team” (“CDIT”). The CDIT was comprised of approximately 13 people whose job it was to “sanitize the databases” of all information related to the 2013-2016 Iran business. The team identified and removed from the databases all data related to those sales. ZTE also established an auto-delete function for the email accounts of those 13 individuals on the CDIT, so their emails were deleted every night – a departure from its normal practices – to ensure there were no communications related to the hiding of the data.
The plea agreement ended a five-year joint investigation into ZTE’s export practices, which was handled by the DOJ’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas, the FBI, the BIS, the Department of Homeland Security and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.
The case is being prosecuted by Deputy Chief Elizabeth Cannon of the National Security Division’s Counterintelligence and Export Control Section and Assistant U.S. Attorney Mark Penley of the Northern District of Texas.
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Woman Sentenced to 97 Months in Prison in Connection with Cocaine Smuggling ConspiracyRead the Press Release
St. Thomas, USVI – Nilda Morton, 32, of St. Thomas, was sentenced today to 97 months in prison, followed by five years of supervised release for possession of cocaine with intent to distribute, Acting United States Attorney Joycelyn Hewlett announced. District Court Judge Curtis V. Gomez also ordered Morton to pay a $700 special assessment and - perform 400 hours of community service.
On January 23, 2017, Morton pleaded guilty to seven counts of possession with intent to distribute not less than five and not more than 15 kilograms of cocaine in connection with a 13-member drug smuggling ring operated by Morton. From October 2015 through July 2016, Morton paid airline employees at the Cyril E. King Airport and female drug couriers to smuggle cocaine to the U.S. mainland. On three occasions between June and July 2016, airport security surveillance footage captured Morton and other drug couriers in a public restroom exchanging vacuum-sealed packages of cocaine before boarding their flights. The investigation culminated on July 1, 2016, with the arrest of Dellana Magner, 23, of St. Thomas, after she had smuggled three kilograms of cocaine onboard an American Airlines flight destined for Miami. Magner pleaded guilty on January 23, 2017, and was sentenced on March 16, 2017, to five years in prison, followed by five years of supervised release for her conviction on cocaine possession.
Still waiting to be sentenced are Vanier Murraine, 34, a native of St. Thomas and resident of Detroit; Christopher Butler, 30, and Drue Williams, III, 35, of Twinsburgh, Ohio; and Taheeda George, 37, Roniqua Hart, 24, Kinia Blyden, 23, and Jerrisha Rawlins, 22, all of St. Thomas. Murraine, Butler, Williams, George, Hart, Blyden and Rawlins all pleaded guilty to possession with intent to distribute cocaine. Also awaiting sentencing are Rasheem Morton, 36, Monique David, 40, and Te’Nae George, 23, all of St. Thomas, who pleaded guilty to money laundering conspiracy. The final defendant, Kanya Tirado, 38, of St. Thomas, was found guilty by a federal jury of three counts of cocaine conspiracy and possession with intent to distribute cocaine will be sentenced on June 8, 2017.
This case is the result of a joint investigation by the Federal Bureau of Investigation in Pittsburgh, New York, Cleveland, Detroit, and St. Thomas. It was prosecuted by Assistant United States Attorney Delia L. Smith.
White Earth Man Sentenced to 30 Years in Prison for MurderRead the Press Release
Acting United States Attorney Gregory G. Brooker today announced the sentencing of STERLING KYLE ANDERSEN, 24, to 30 years in prison for second degree murder. ANDERSON, who was indicted on February 1, 2016, pleaded guilty on November 9, 2016, before U.S. District Judge Ann D. Montgomery in Minneapolis, Minn.
According to the defendant’s guilty plea and documents filed in court, on October 7, 2015, while babysitting his girlfriend’s three-year-old son (identified as S.W.W.), ANDERSEN became agitated when he was not able to stop S.W.W. from crying. As a result of his frustration, ANDERSEN brutally assaulted S.W.W. with his fists and knees causing traumatic internal and external injuries. When emergency personnel and law enforcement arrived, ANDERSEN said that S.W.W. had fallen in the woods while running and hit his head, but ultimately confessed to the brutal assault. The victim was transported to the hospital via helicopter but was pronounced dead shortly after arriving.
This case is the result of an investigation conducted by the Minnesota Bureau of Criminal Apprehension, White Earth Police Department, Becker County Sheriff’s Office, and the FBI.
Assistant U.S. Attorney Deidre Y. Aanstad prosecuted the case.
Defendant Information:
STERLING KYLE ANDERSEN, 24
Duluth, Minn.
Convicted:
- Murder in the second degree, 1 count
Sentenced:
-
360 months in prison
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Five years supervised release
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Western Massachusetts Power Plant Owner and Management Companies Sentenced for Tampering and False ReportingRead the Press Release
BOSTON – Berkshire Power Company (BPC) and Power Plant Management Services, Inc. (PPMS) were sentenced yesterday in U.S. District Court in Springfield for tampering with air pollution emissions equipment, and PPMS was also sentenced for submitting false information to both environmental and energy regulators relating to the Berkshire Power Plant (“the Plant”) in Agawam, Mass.
United States District Court Judge Mark G. Mastrioanni sentenced BPC to pay $2.75 million in criminal fines for violations of the Clean Air Act and to make a $750,000 community service payment to the American Lung Association to fund a program for the replacement of polluting wood burning stoves in western Massachusetts. Judge Mastrioanni sentenced PPMS to pay $500,000 in criminal fines for violations of the Clean Air Act and Federal Power Act and to make a $250,000 community service payment to the American Lung Association’s wood stove change-out program.
In addition to the criminal fines outlined above, BPC and PPMS have agreed to pay $3,042,563 plus interest to the Federal Energy Regulatory Commission in civil penalties and disgorgement for their misrepresentations to ISO-New England regarding the Plant’s availability to produce power.
In May 2016, BPC (owner of Berkshire Power Plant) and PPMS (the Plant manager) pleaded guilty to felony charges that they violated and conspired to violate the federal Clean Air Act. These charges arose from air pollution monitoring equipment tampering and related false emissions reporting between 2009 and 2011. PPMS also pleaded guilty to violating the Federal Power Act, the first-ever criminal charges under this statute, for making false statements to the regional power grid administrator, ISO-New England, regarding the Plant’s availability to produce power.
According to documents filed in federal court, between January 2009 and March 2011, BPC engaged PPMS to manage the Plant, including overseeing day-to-day operations and maintenance and to act as the owner’s representative for the Plant. A PPMS employee served as the Plant General Manager and as BPC’s on-site representative.
PPMS and BPC caused staff at the Plant to tamper with the Plant’s air pollution monitoring equipment to conceal the fact that the Plant was emitting air pollutants in excess of permitted levels. This tampering was accomplished by intentionally biasing the Plant’s Continuous Emissions Monitoring System so it would show lower emissions levels than were actually being produced by the Plant. BPC and PPMS then used this inaccurate data in filing required emissions reports with the U.S. Environmental Protection Agency (USEPA) and the Massachusetts Department of Environmental Protection (MassDEP). The purpose of the tampering was to avoid lost revenues that would have resulted from reducing power production to stay within the Plant’s air pollution emissions limits, or by taking the Plant out of service to implement needed repairs of the Plant’s pollution control and other equipment.
Excess nitrogen oxide (NOx) emitted from fossil-fuel-burning power plants and mobile sources, like cars and trucks, combines in the atmosphere with volatile organic compounds emitted from industrial and residential sources to form ground-level ozone. At ground level, ozone is a respiratory pollutant that can cause many human respiratory effects, and even premature mortality, especially in vulnerable elderly persons and young children. NOx emissions also cause environmental damage to coastal waters, aquatic life, and other property, and contribute to the formation in the atmosphere of fine particulates that also harm humans, aquatic life, and vegetation.
During the course of the tampering investigation, criminal investigators also learned that PPMS made and caused staff at the Plant to make false statements to the ISO-New England, about the Plant’s availability to produce power for the New England grid. They also caused staff at the Plant to falsely claim to the ISO that the Plant was available to produce power when it was not. PPMS did this to maximize the Plant’s revenues and to minimize repair expenditures.
Acting United States Attorney William Weinreb and Massachusetts Attorney General Maura Healey made the announcement following a joint federal and state investigation into allegations that Berkshire Power Plant in Agawam, Mass., tampered with its air pollution monitoring equipment and falsely reported data to environmental and energy regulators regarding its emissions levels and its availability to produce power.
Tyler Amon, Special Agent in Charge of the U.S. Environmental Protection Agency’s Criminal Investigation Division in Boston and Commissioner Martin Suuberg of the Massachusetts Department of Environmental Protection, also joined in the announcement today. Assistance with the investigation was provided by the Massachusetts Environmental Crimes Strike Force (an interagency investigative team dedicated to developing the most significant environmental enforcement cases) and the Massachusetts Environmental Police. Assistant U.S. Attorney Sara Miron Bloom of Weinreb’s Economic Crimes Unit is prosecuting the federal case with the assistance of Dianne Chabot, USEPA Criminal Enforcement Counsel.
Vermont Man Sentenced to 24 Months in Prison for Heroin DealingRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that, on March 22, 2017, Michael Prescott, 52, of Fairfax, Vermont, was sentenced to 24 months in federal prison after his guilty plea to charges that he distributed heroin. U.S. District Court Judge Geoffrey W. Crawford also ordered that Prescott serve three years of supervised release after his prison term.
According to court records, in March of 2016, Prescott was obtaining heroin and cocaine from an out-of-state source and distributing it in Vermont. On March 7, 2016, Prescott sold heroin to a confidential informant working with the Drug Enforcement Administration (DEA). DEA captured the heroin deal on video. Prescott was arrested on July 18, 2016 and has been in federal custody since.
For his crime, Prescott faced a statutory maximum term of 20 years in prison. The United States Sentencing Guidelines, which are advisory, recommended that Prescott receive a prison term between 24 and 30 months. The government argued for a sentence within this range. The defense advocated for a sentence of time served. In determining that a 24-month sentence was appropriate, Judge Crawford considered the severity of the offense and Prescott’s lengthy criminal record, which includes a 2004 federal felony conviction in the District of Vermont for conspiracy to distribute cocaine.
Acting United States Attorney Eugenia Cowles commended the efforts of DEA for their work in this investigation. Acting United States Attorney Cowles noted that this case is part of the U.S. Attorney’s Office’s Vermont Heroin Initiative, which is a coordinated effort by the U.S. Attorney’s Office and federal, state, and local law enforcement agencies to combat heroin distribution in Vermont.
The prosecution is being handled by Assistant U.S. Attorney Timothy C. Doherty, Jr. Prescott is represented by Federal Public Defender Michael Desautels.
Two Sentenced to Life in Prison for the Armed Robbery, Kidnapping and Murder of Charlotte ManRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Jill Westmoreland Rose announced today that Carlos Antoine Benson and Jacob Ivan Hill were sentenced to life in prison by Chief U.S. District Judge Frank D. Whitney, in connection with the 2014 armed robbery, kidnapping and murder of a Charlotte man. Benson was ordered to serve two consecutive life sentences, and both defendants were ordered to pay $6,750 as restitution.
Benson, 37, and Hill, 36, both of Charlotte, were convicted by a federal jury in September 2016 of all charges in the federal indictment, including Hobbs Act robbery and crimes resulting in murder.
C.J. Hyman, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division and Chief Kerr Putney of the Charlotte-Mecklenburg Police Department join U.S. Attorney Rose in making today’s announcement.
According to filed court documents, trial evidence, witness testimony and information introduced at the sentencing hearing:
On November 12, 2014, Benson and Hill robbed an individual at gunpoint from whom Hill had been purchasing small amounts of cocaine. Benson and Hill told the individual they wanted to get in touch with his supplier (the victim), causing the individual, at gunpoint, to hand over his cell phone to Hill. Pretending to be the individual, Hill called the victim and arranged to meet on the same day at the parking lot of an apartment complex in Charlotte to purchase drugs. Benson and Hill warned the individual they would “off him” if he tried to alert the victim to the plan.
At the designated location, Benson, armed with a handgun, hid in the back of the individual’s parked vehicle, while Hill walked to a wooded area nearby to serve as lookout for the robbery. When the victim arrived, he entered the parked vehicle and sat in the front passenger seat. Benson sat up behind him and pointed the gun at the victim. Benson told the victim not to flinch, and began to demand the victim’s rings. When the victim reached for a handgun tucked in his pocket, Benson fired his gun, shooting the victim six times, including once in the back of the head. Benson was also wounded.
Immediately after the shooting, Benson approached the victim’s vehicle and observed the victim’s girlfriend seated in the driver’s seat. Benson raised his gun to shoot. The woman, who at the time was four months pregnant, managed to drive away unharmed and called 9-1-1. Benson and Hill fled the scene in Hill’s vehicle. Hill then drove to a secluded cul-de-sac, dropped off Benson in the grass and drove away. Hill was arrested later that same day with firearms and drugs inside his vehicle. Paramedics located Benson in the grass and transported him to the hospital. Upon discharge from the hospital, Benson was arrested.
In announcing today’s sentence, U.S. Attorney Rose said, “Benson and Hill planned and carried out a scheme to rob a suspected narcotics trafficker, ultimately killing him over a small amount of drugs and cash. The two men will now have to spend the rest of their lives in prison for their violent crime. I want to thank the ATF and CMPD for their investigation of this case and for their collaborative efforts to protect our communities from this type of criminal activity.”
“ATF’s mission is to combat violent crime and this investigation achieved that goal. The arrests and subsequent life sentences for Benson and Hill send a clear message that ATF and its law enforcement partners will not allow violent criminals to continue victimizing our communities and neighborhoods,” said Special Agent in Charge Hyman.
Following a two-week trial, Benson and Hill were each convicted of nine charges, including: Hobbs Act robbery and aiding and abetting; conspiracy to commit kidnapping; kidnapping and aiding and abetting; conspiracy to possess with intent to distribute cocaine; possession with intent to distribute cocaine and aiding and abetting; brandishing/discharging a firearm during and in relation to a crime of violence or drug trafficking crime and aiding and abetting; causing death in the course of using, carrying and possessing a firearm and in relation to a crime of violence or drug trafficking crime and aiding and abetting; and possession of a firearm by a convicted felon.
Benson and Hill are currently in federal custody and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentenced sentences are served without the possibility of parole.
The investigation was led by the ATF and CMPD. Assistant U.S. Attorney Sanjeev Bhasker, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
Two Idaho Men Sentenced for their Roles in Separate Drug Trafficking ConspiraciesRead the Press Release
BOISE – Oscar Javier Rosas, 23, of Wendell, Idaho and Michael Ray Stone, 25, of Twin Falls, Idaho, were sentenced this week in United States District Court for their roles in separate drug trafficking conspiracies, Acting United States Attorney Rafael Gonzalez announced. Senior U.S. District Judge Edward J. Lodge sentenced Rosas to 33 months in prison for conspiracy to distribute methamphetamine and Stone to 51 months for distribution of methamphetamine.
These cases were prosecuted by the Special Assistant U.S. Attorney hired by the Ada County Prosecuting Attorney’s Office with funding provided by the Idaho extension of the Oregon-Idaho High Intensity Drug Trafficking Area (HIDTA) program. Created by Congress in 1988, the HIDTA program serves as a catalyst for coordination among federal, state, local, and tribal law enforcement agencies operating in areas determined to be critical drug trafficking regions of the United States. Idaho is part of the Oregon-Idaho HIDTA. The Idaho HIDTA is a collaboration of local, multi-jurisdictional law enforcement drug task forces and prosecuting agencies dedicated to addressing regional drug trafficking organizations that operate in Ada, Canyon, and Malheur County.
In June of 2015, the Oregon-Idaho HIDTA, in collaboration with the Ada County Prosecutor’s Office and the Idaho U.S. Attorney’s Office, hired the Special Assistant U.S. Attorney to facilitate the prosecution of regional drug trafficking organizations identified by drug enforcement task forces in the Treasure Valley. The Special AUSA coordinates with local prosecuting offices and the drug enforcement task forces to federally prosecute cases that fall within or affect the HIDTA areas.
The Special Assistant U.S. Attorney hired by the HIDTA program has facilitated the prosecution of 39 drug trafficking cases which has resulted in 51 individuals being convicted and sentenced for drug trafficking crimes. These prosecutions underscore the efforts of both local and federal law enforcement agencies and prosecutors in Idaho working together at every level to make our communities safer from drug trafficking crime.
Three Men Arrested for Wire Fraud Scheme Involving Multilevel Marketing CompanyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
ROCHESTER, N.Y.—Acting U.S. Attorney James P. Kennedy, Jr. announced today that Craig Jerabeck, 56, of Rochester, NY; Jeb Tyler, 44, of Penfield, NY; and Jason Guck, 42, of Victor, NY, were arrested and charged by criminal complaint with wire fraud and conspiracy. The charges are punishable by up to 20 years in prison and a fine of $250,000.
Assistant U.S. Attorney Craig R. Gestring, who is handling the case, stated that according to the complaint, from at least 2001 to 2015, Jerabeck was the co-founder, President and Chief Executive Officer of 5LINX, a Rochester based multilevel marketing company. From at least 2001 to the present, Guck and Tyler were co-founders and Vice Presidents of 5LINX. In June 2006, 5LINX entered into a purchase agreement and a stockholder’s agreement with two investment companies. As a condition of the purchase agreement, the investors, 5LINX and the defendants entered into a stockholder’s agreement, which defined certain conditions, rights, and obligations. Among other conditions, the defendants compensation was limited, and any bonus payments required approval by the Board of Directors.
Jerabeck, Tyler, and Guck engaged in a scheme to defraud investors by causing millions of dollars to be diverted from 5LINX into their own personal bank accounts or onto their debit cards without the knowledge or approval of the investors. Beginning in approximately 2009, and continuing until at least May 15, 2015, without the knowledge, permission, or authorization of investors, the defendants created and inserted fraudulent contracted representatives into the 5LINX direct sales team in order to make additional income in excess of their compensation plan. To execute the scheme, the defendants set-up fraudulent 5LINX independent contractor accounts under multiple company names which were actually controlled by the defendants individually or together. Those shell companies were utilized in order to conceal the real owner’s information from employees and the investors.During times relevant to the conspiracy, Jerabeck, Tyler, and Guck failed to disclose to the investors that they were independent contractors of 5LINX and that they were covertly receiving millions of dollars in additional compensation without the investors’ knowledge or permission. This resulted in inaccurate corporate financial documents being issued which significantly understated the company’s available cash. Those inaccurate statements were then relied upon by the investors in making financial decisions related to their investment in 5Linx. As a result, investors lost as much as $4,000,000.
The criminal complaint is the culmination of an investigation by Special Agents of the Federal Bureau of Investigations, under the direction of Special Agent-in-Charge Adam S. Cohen.The defendants made initial appearances this morning before U.S. Magistrate Judge Jonathan W. Feldman and were released on conditions. Jerabeck, Tyler, and Guck are due back in court for a status hearing on May 5, 2017 at 9:30 a.m.
The fact that a defendant has been charged with a crime is merely an accusation and the defendants are presumed innocent until and unless proven guilty.
Texas Woman Sentenced to 18 Months for Wire Fraud SchemeRead the Press Release
SYRACUSE, NEW YORK – Krystal L. Moreno, 31, of San Antonio, Texas, was sentenced today to serve eighteen (18) months in prison for wire fraud, announced United States Attorney Richard S. Hartunian, Special Agent in Charge Vadim D. Thomas, Albany Division of the Federal Bureau of Investigation (FBI) and New York State Police Superintendent George P. Beach. Her prison term will be followed by three (3) years of supervised release. United States District Judge Brenda K. Sannes also ordered Moreno to pay $213,948.09 in restitution to the thirty-five victims of her crime.
Monroe pled guilty to wire fraud on September 19, 2016 in connection with a scheme to defraud timeshare owners. As part of the fraud, Moreno received over $200,000 in wire transfers to bank accounts she opened in Texas. Victims of the scheme, including a resident of Clinton, New York, wired money believing that their timeshares would be sold when, in fact, no buyers existed.
This case was investigated by the Federal Bureau of Investigation (FBI) and the New York State Police, and was prosecuted by Assistant U.S. Attorneys Carina H. Schoenberger and Robert S. Levine.
Statement by Attorney General Jeff Sessions on the Arrest in IsraelRead the Press Release
Attorney General Sessions released the following statement on the arrest in Israel:
“Today’s arrest in Israel is the culmination of a large-scale investigation spanning multiple continents for hate crimes against Jewish communities across our country. The Department of Justice is committed to protecting the civil rights of all Americans, and we will not tolerate the targeting of any community in this country on the basis of their religious beliefs. I commend the FBI and Israeli National Police for their outstanding work on this case.”
Socorro Man Sentenced to Five Years in Prison for Federal Methamphetamine Trafficking ConvictionRead the Press Release
ALBUQUERQUE – Joel Martinez, 31, of Socorro, N.M., was sentenced today in federal court in Santa Fe, N.M., to 60 months in prison followed by four years of supervised release for his methamphetamine trafficking conviction.
Martinez was arrested in Aug. 2015, on a criminal complaint charging him with possession of methamphetamine with intent to distribute on Aug. 26, 2015, in Socorro County, N.M. According to the complaint, law enforcement officers executed a search warrant on Martinez’s residence on Aug. 26, 2015, and seized 392 grams of methamphetamine, a disassembled firearm, and drug paraphernalia. Martinez was indicted on the same charge on Sept. 22, 2015.
On June 10, 2016, Martinez pled guilty to the indictment. In entering the guilty plea, Martinez admitted that on Aug. 26, 2015, law enforcement officers executed a search warrant on his residence in Socorro, and found approximately 392 grams of methamphetamine, which he intended to distribute to others.
This case was investigated by the Albuquerque office of the DEA, the HIDTA Region I Narcotics Task Force and the Socorro Police Department, and was prosecuted by Assistant U.S. Presiliano Torrez.
The HIDTA Region I Narcotics Task Force is comprised of the Albuquerque Police Department, Albuquerque office of the DEA, Pojoaque Tribal Police Department, Rio Rancho Police Department, Sandoval County Sheriff’s Office and the Valencia County Sheriff’s Office. The High Intensity Drug Trafficking Areas (HIDTA) program was created by Congress with the Anti-Drug Abuse Act of 1988. HIDTA is a program of the White House Office of National Drug Control Policy (ONDCP) which provides assistance to federal, state, local and tribal law enforcement agencies operating in areas determined to be critical drug-trafficking regions of the United States and seeks to reduce drug trafficking and production by facilitating coordinated law enforcement activities and information sharing.
Social Security Administration Employee and Husband Indicted in Public Benefit Fraud SchemeRead the Press Release
Montgomery, Ala. – Nakia Palmer, 34, an employee of the Social Security Administration (SSA), and her husband, Nathaniel Palmer, 29, both of Montgomery, Alabama, were arrested yesterday after being charged with eight separate offenses, all related to the Palmers’ schemes to fraudulently receive government benefits, announced Acting United States Attorney A. Clark Morris. The charges in their indictment include mail fraud, fraudulently obtaining Social Security benefits, theft of federal government property, health care fraud, and fraudulent acquisition of food stamp benefits.
According to the indictment, the Palmers made false statements about their income and living arrangements to obtain Social Security benefits for Nakia Palmer’s minor son. If the Palmers had properly reported their income, including Nakia Palmer’s income from the SSA, and had been truthful about their living arrangements, the SSA would have denied their application for benefits. Nakia Palmer also made false statements about her income to obtain Medicaid health insurance benefits for her minor son and to obtain food stamps for her family. In total, the Palmers’ received approximately $25,000 in benefits to which they were not entitled.
If convicted of the most serious charges, both defendants face maximum sentences of 20 years’ imprisonment, as well as substantial monetary penalties.
An indictment merely alleges that crimes have been committed. The defendants are presumed innocent until proven guilty beyond a reasonable doubt.
This case was investigated by the SSA - Office of Inspector General, as well as the United States Department of Health and Human Services - Office of Inspector General, and the United States Department of Agriculture - Office of Inspector General. Assistant United States Attorney Jonathan S. Ross is prosecuting the case.
Simpsonville Man Pleads Guilty to Being a Felon in Possession of a Firearm and AmmunitionRead the Press Release
Contact Person: Max Cauthen, II (864) 282-2100
Greenville, South Carolina---- United States Attorney Beth Drake stated today that Barry David Bassett, age 41, of Simpsonville, South Carolina, pled guilty in federal court in Greenville, South Carolina, to being a felon in possession of a firearm and ammunition, a violation of 18 U.S.C. 922(g). United States District Court Judge Bruce H. Hendricks of Charleston accepted the plea and will impose sentence after she has reviewed the presentence report prepared by the U.S. Probation Office.
Bassett faces a statutory maximum sentence of 10 years in federal prison. Evidence presented by the government during the plea established that on November 9, 2016, South Carolina Department of Probation, Pardon, and Parole agents were conducting a home visit with Bassett and observed a Weatherby .257 caliber rifle and .257 caliber ammunition on the premises.
Prior to that date Bassett had previously been convicted of a crime for which he could have received more than a year in prison and agents confirmed that he had not received a pardon nor had his rights restored to possess firearms or ammunition.
Bassett was arrested federally as a part of “Operation Real-Time.” The goal of this program is to identify individuals for federal prosecution with significant criminal histories who continue to actively possess firearms in the Upstate community.
In addition to the South Carolina Department of Probation, Pardon, and Parole Services and the Bureau of Alcohol, Tobacco, and Firearms, Real Time’s core partners include the Greenville Police Department, the Greenville County Sheriff’s Office, the Anderson Police Department; the South Carolina Department of Probation, Parole, and Pardon Services; the South Carolina Highway Patrol; United States Probation; the Department of Homeland Security; the Federal Bureau of Investigation; the Drug Enforcement Administration; the 13th Circuit Solicitor’s Office; and the United States Attorney’s Office.
Since August of 2015, the initiative has resulted in the expedited federal prosecution of some 90 defendants and seizure of approximately 110 firearms as well as assorted ammunition from prohibited persons.
U.S. Attorney Beth Drake commended the partnership between the state and federal agencies that led to the Bureau of Alcohol, Tobacco and Firearms and the U.S. Attorney’s Office adopting the case, “We work best when we work together. This ‘real time’ identification of high risk offenders is smart policing, and we welcome the opportunity to work alongside our state chiefs and sheriffs in taking violent repeat offenders out of our communities.”
The South Carolina Department of Probation, Pardon, and Parole, Greenville County Sheriff’s Office along with agents from the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) investigated the case. The case is assigned to Assistant United States Attorney Max Cauthen in the Greenville U.S. Attorney’s Office.
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Shreveport man sentenced to 57 months in prison for felony possession of firearmsRead the Press Release
SHREVEPORT, La. – Acting U.S. Attorney Alexander C. Van Hook announced today that a Shreveport man was sentenced to 57 months in prison for illegally possessing two pistols after being convicted of a felony.
Terrell Kellum, 29, of Shreveport, was sentenced by U.S. District Judge Elizabeth E. Foote on one count of felon in possession of a firearm. He was also sentenced to three years of supervised release. According to the October 4, 2016 guilty plea, a member of the public informed law enforcement on November 6, 2015 that an individual was carrying two pistols near the intersection of Linwood and 70th Street in Shreveport. A Shreveport police officer conducted a traffic stop on the vehicle, searched it and found two .380 caliber Lorcin Model L380 pistols. Kellum had been previously convicted of a felony and was not allowed to possess a firearm.
This investigation and prosecution is part of Project Safe Neighborhoods, a Department of Justice initiative to promote firearm safety and reduce firearm crimes by preventing the possession and use of firearms by dangerous and persistent felons and others not authorized to possess a firearm.
The ATF and Shreveport Police Department conducted the investigation. Assistant U.S. Attorney Jonathan S. Drucker prosecuted the case.
Sentencings for March 22 & March 23, 2017Read the Press Release
Mateo Alvaro-Arcos, 39, of Mexico, was sentenced by Federal District Court Judge Alan B. Johnson on March 23, 2017, for illegal re-entry of a previously deported alien into the United States. Alvaro-Arcos was arrested in Rock Springs, Wyoming. He received time served plus 10 days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Ronald Joel Mendoza-Montoya, 31, of Mexico, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on March 22, 2017, for illegal re-entry of a previously deported alien into the United States. Mendoza-Montoya was arrested in Douglas, Wyoming. He received six months of imprisonment, to be followed by one year of supervised release, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Rio Rancho Woman Sentenced for Filing False Claim for Federal Tax RefundRead the Press Release
ALBUQUERQUE – Frances Jo Mehner, 71, of Rio Rancho, N.M., was sentenced yesterday afternoon in federal court in Albuquerque, N.M., to a 207-day term of imprisonment, which she has already served, followed by a year of supervised release for filing a false claim for a federal tax refund.
Given Mehner’s obstructive behavior towards the IRS, the federal judge also ordered Mehner to comply with several special conditions during her term of supervised release. Mehner is required to file timely, accurate, and lawful tax returns. Mehner also may only communicate with the IRS through a licensed attorney. She also is prohibited from filing any liens or other forms against any employee of the U.S. District Court for the District of New Mexico, the U.S. Attorney’s Office, or the IRS.
Mehner was charged in a three-count indictment that was filed on Dec. 16, 2014. Counts 1 and 2 of the indictment charged Mehner with filing false claims for federal tax refunds. Count 1 charged Mehner with filing a false claim for a federal tax refund in the amount of $211,334,725.00 in Jan. 2010, and Count 2 charged her with filing a false claim for a federal tax refund in the amount of $958,163,765.00 in Jan. 2010. Count 3 of the indictment charged Mehner with unlawfully seeking to obstruct and impede the administration of the federal tax laws by filing false tax returns for tax years 1996, 1999 and 2002 through 2008. The indictment alleged that Mehner committed these offenses in Sandoval County, N.M.
On March 13, 2017, Mehner pled guilty to Count 2 of the indictment charging her with making a false claim for a federal tax refund. In entering the guilty plea, Mehner admitted that on Jan. 8, 2010, she presented to the IRS a claim for a tax refund in the amount of $958,163,765.00, while knowing that she was not entitled to such a refund. Mehner further admitted making the false claim by mailing a U.S. Individual Income Tax Return Form 1040 for the year 2006.
This case was investigated by the Albuquerque offices of IRS Criminal Investigation and the FBI, and was prosecuted by Assistant U.S. Attorneys Sean J. Sullivan, Brandon Fyffe and Margaret M. Vierbuchen.
Richardson Man Indicted for Making False Statement to the FBIRead the Press Release
DALLAS — A federal grand jury in Dallas returned an indictment yesterday, charging a Richardson, Texas, man with six counts of making false statements to federal agents, announced John Parker, U.S. Attorney for the Northern District of Texas and Eric Jackson, Special Agent in Charge of the Dallas Field Office of the FBI.
The charges stem from alleged false statements that Said Azzam Mohamad Rahim made to federal law enforcement officers on March 5, 2017, during a terrorism investigation. The indictment alleges that, when interviewed, Rahim made a number false statements related to his support for ISIS and his prior statements relating to violence and terrorist activity.
Rahim, 40, was arrested earlier this month on a criminal complaint and is in custody pending trial. A trial date has not been set. The maximum statutory penalty for each count alleged in the indictment is eight years in federal prison, a period of supervised release, and a $250,000 fine.
The Federal Bureau of Investigation is responsible for this investigation. Assistant United States Attorney Errin Martin is prosecuting the case with assistance from the National Security Division’s Counterterrorism Section.
The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes. If convicted of any offense, the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
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Police Station Escapee Sentenced for Gun PossessionRead the Press Release
DAYTON – David A. McComb Jr., 32, of Dayton, was sentenced in U.S. District Court to 77 months in prison for possessing a firearm after having been convicted of a felony.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, Trevor Velinor, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and Dayton Police Chief Richard Biehl announced the sentence handed down today by U.S. District Judge Thomas M. Rose.
McComb was arrested on April 6, 2016, three days after escaping from a police station. At the time of his arrest, he was carrying a pistol. McComb had previously been convicted for felony offenses, including aggravated robbery with a deadly weapon, burglary, intimidation and abduction.
McComb was sentenced locally to 18 months in prison for the escape offense.
He pleaded guilty to the federal gun offense on November 10.
U.S. Attorney Glassman commended the cooperative investigation by the Dayton Police Department and ATF, as well as Assistant United States Attorneys Dominick S. Gerace and Dwight K. Keller, who are representing the United States in this case.
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Pittsburgh Man Charged with Distributing, Possessing Child PornographyRead the Press Release
PITTSBURGH - An Allegheny County resident has been indicted by a federal grand jury in Pittsburgh on charges of distribution and possession of material depicting the sexual exploitation of a minor, Acting United States Attorney Soo C. Song announced today.
The two-count indictment, returned on March 21 and unsealed Wednesday, named Walter B. Williams, 45, of Pittsburgh, Pennsylvania as the sole defendant.
According to the indictment, Williams distributed videos containing material depicting the sexual exploitation of minors. The indictment further alleges that Williams knowingly possessed videos and images in computer graphics and digital files, the production of which involved the use of minors engaging in sexually explicit conduct, some of whom had not yet attained 12 years of age.
“HSI special agents will relentlessly pursue predators who deal in the exploitation of images our children,” said Marlon V. Miller, special agent in charge of HSI Philadelphia. “Thanks to the ceaseless efforts of our highly skilled HSI special agents another sexual predator will face justice.”
The law provides for a maximum total sentence of 30 years in prison, a fine of $500,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Shaun E. Sweeney is prosecuting this case on behalf of the government.
U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Men Charged with Bucks County Bank RobberyRead the Press Release
Joel Lee Quentin Scott, 22, of Philadelphia, PA, and Jonathan Maurice Scott, 33, of Philadelphia, PA, were charged today by indictment with armed bank robbery and a related firearm charge announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about December 29, 2016, Joel and Jonathan Scott robbed the BB&T Bank located at 1201 Buck Road, Feasterville, PA, of approximately $1,800 in United States Currency. A loaded firearm was brandished during the robbery.
If convicted of the charges, each defendant faces a maximum sentence of life imprisonment and a mandatory minimum of 7 years’ imprisonment. They also each face a maximum period of supervised release of 5 years, a substantial fine, a $200 special assessment, restitution, and forfeiture of the firearm and ammunition.
The case was investigated by the Lower Southampton Township Police Department and the Federal Bureau of Investigation (“FBI”), 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.
Pelham Man Pleads Guilty to Distributing Anabolic SteroidsRead the Press Release
BIRMINGHAM – A Pelham man pleaded guilty today in federal court to charges related to distribution of anabolic steroids, announced Acting U.S. Attorney Robert O. Posey, U.S. Postal Inspector in Charge Adrian Gonzalez, and Alabama Law Enforcement Agency Secretary Stan Stabler.
MICHAEL ANTHONY SPANO, 30, pleaded guilty before Chief U.S. District Court Judge Karon O. Bowdre to one count of conspiracy to possess and distribute the anabolic steroids testosterone propionate, trenbolone acetate, nandrolone decanoate, testosterone enanthate and stanozolol in Jefferson and Shelby counties between May 2013 and May 2016. He also pleaded guilty to one count of possessing with intent to distribute those steroids in Shelby County on May 13, 2016.
“The defendant in this case imported bulk quantities of steroid powder into the United States through the mail and then manufactured injectable and oral steroids at a clandestine lab in his basement in Pelham, Ala.,” Gonzalez said. “Postal inspectors will vigorously investigate crimes where the U.S. Mails are used to place the public at risk. This case is an example of how postal inspectors, working with our law enforcement partners, seek to protect the public from the criminal misuse of the U.S. Mail.”
Spano is scheduled for sentencing July 27. The maximum penalty for both distribution charges is 10 years in prison and a $500,000 fine.
U.S. Postal Inspectors and the ALEA State Bureau of Investigation investigated the case, which Assistant U.S. Attorney Brad Felton is prosecuting.
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Palmer Man Indicted on Federal Murder Charges and String of Armed Home Invasion RobberiesRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Bryan Schroder announced today that a federal grand jury in Anchorage indicted John Pearl Smith II, age 30, of Palmer, for the murders of Wasilla residents Ben Gross and Crystal Denardi on June 5, 2016. If convicted, Smith faces either life in prison or the federal death penalty.
The indictment alleges that in September 2015, May 11, 2016, and June 5, 2016, Smith attempted to rob people he believed were involved in trafficking drugs. On each occasion, the indictment alleges that he brandished firearms during the robbery. On the last occasion, it alleges he shot and killed Ben Gross and Crystal Denardi during the robbery, as well as shot a third individual, identified in the indictment as “R.B.” The indictment alleges “special findings” that could make Smith eligible for the federal death penalty, including that he committed the murders after substantial planning and premeditation, and after having been previously convicted of a gunpoint robbery in Alaska in 2006. Pursuant to Department of Justice policy, the Attorney General of the United States will decide whether Smith will face the death penalty if convicted.
Acting U.S. Attorney Bryan Schroder said: “The connection between drugs and violence is inextricable, and we have been directed by the Attorney General to take aim at violent crime in our communities by working with our state and local partners. This investigation is a great example of that partnership, as the Alaska State Troopers, who led the investigation, brought in the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Drug Enforcement Administration to assist the Alaska Bureau of Investigation and the Statewide Drug Enforcement Unit MatSu Office. The result was that John Pearl Smith II was initially indicted and held on federal charges of being a felon in possession of firearms shortly after the murders, which allowed state and federal authorities to finish the investigation, which uncovered additional robberies. We worked with the Palmer District Attorney’s Office, and we jointly decided to pursue federal charges for the murders.”
This indictment comes one month after another major violent crime indictment in which Matthew James Scharber, age 35, Michael Charles Elder, age 24, and Corey Stanley Sylva, age 26, were charged with federal crimes including kidnapping, carjacking, and using firearms to shoot two victims who were left for dead up at Hatcher’s Pass. In that case, the Alaska State Troopers teamed with the FBI Safe Streets Task Force to bring federal charges after coordination with the Anchorage District Attorney’s Office. The men face life in federal prison, including lengthy mandatory minimum sentences.
Other cases charged this month and last focus on Kodiak, where a joint Kodiak Police Department, Coast Guard Investigative Service, Alaska State Troopers, and the FBI’s Safe Streets Task Force investigation led to the charging of three Kodiak men for drug trafficking, firearm crimes, or both: Nathan Gambrell, age 43 (felon in possession of firearms), Jose Alberto “Bird” Rodriguez, age 29 (methamphetamine possession with intent to distribute), and Wahyo “Kodiak Mike” Sanjoyo, age 35, (methamphetamine trafficking and possessing firearms in furtherance of drug trafficking). As part of this investigation, authorities seized 36 illegal firearms and large quantities of narcotics.
Mr. Schroder added: “These cases are consistent with Attorney General Sessions March 8, 2017, directive to reduce violent crime by partnering with federal, state, and local law enforcement to identify serious offenders, and if appropriate, use federal statutes to prosecute. We are committed to a unified approach to combat the violent crime and drug issues in Alaska.”
Indictments are only charges and are not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Palm Beach County Sheriff’s Deputy Pleads Guilty to Aggravated Identity TheftRead the Press Release
A Palm Beach County Sheriff’s deputy pled guilty today, before United States District Judge Donald M. Middlebrooks, to providing personally identifying information to another individual who used that information in an identity theft scheme.
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), Sean Scheller, Chief, Town of Lantana Police Department, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and Ric Bradshaw, Sheriff, Palm Beach County Sheriff’s Office, made the announcement.
Frantz Felisma, 42, of Boynton Beach, a deputy with the Palm Beach County Sheriff’s Office, pled guilty to access device fraud in connection with the identity theft scheme, in violation of Title 18, United States Code, Section 1029(a)(2) and aggravated identity theft Title 18, United States Code, Section 1028A(a)(1) (Case No. 17-CR-80008). Felisma faces a mandatory minimum of two years’ imprisonment, to run consecutive to any other term of imprisonment imposed, as to the aggravated identity theft charge; and a maximum of ten years’ imprisonment as to the access device fraud charge. Felisma is scheduled to be sentenced on June 7, 2017 at 11:00 a.m. before Judge Middlebrooks.
According to the court record, over the span of approximately eighteen months, Deputy Felisma used his police department issued laptop computer to access a law enforcement database in order to obtain personally identifying information (PII) belonging to numerous individuals. Felisma sold this information to his co-conspirator, who then used the identities of at least 15 of these victims to set up credit card and bank accounts, stealing tens of thousands of dollars in the names of the victims. Felisma’s criminal conduct caused over $135,000 in financial losses.
Mr. Greenberg commended the investigative efforts of ICE-HSI, the Lantana Police Department, IRS-CI and Palm Beach County Sheriff’s Office. This case is being prosecuted by Assistant United States Attorneys Lauren Jorgensen and Rinku Tribuiani.
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.
Owners of Peabody Pizza Shop Charged with Obstructing a Federal Criminal InvestigationRead the Press Release
BOSTON – The owners of Giovanni’s Roast Beef & Pizza in Peabody, Mass., were arrested yesterday and charged in U.S. District Court in Boston with obstruction of justice for removing items from a safe deposit box following the execution of federal search warrants.
Theodora Panousos, a/k/a Dora Panousos, 63, and Konstantinos Panousos, a/k/a Kosta Panousos, 37, were charged in a criminal complaint with two counts of corruptly concealing a record, document or other object, and attempting to do so with the intent to impair the object’s integrity or availability for use in an official proceeding. They were released on bond following an initial appearance before U.S. District Court Magistrate Judge David H. Hennessy.
According to the complaint, Dora and Kosta were under investigation for tax evasion and filing false tax returns, specifically for failing to report all of Giovanni’s gross income. On the morning of Feb. 15, 2017, investigators executed search warrants at Giovanni’s restaurant and at Dora’s residence and seized, among other things, safe deposit box keys. That same morning, both Dora and Kosta were served with grand jury subpoenas for, among other things, records and tangible objects “pertaining to the payment, receipt, transfer or storage of money or other things of value.”
After the searches, and after Dora and Kosta were served with the subpoenas, the two allegedly went to a bank and emptied a safe deposit box except for a few pieces of jewelry. Surveillance footage allegedly showed Dora entering the bank with an empty tote bag and leaving the bank with what appeared to be items from the safe deposit box in the tote bag.
Fifteen minutes later, Dora and Kosta arrived at a second bank where Dora had another safe deposit box. Dora told bank employees she had lost the keys and requested that they have the box drilled. However, before they could do so, investigators executed a search warrant for the box and discovered that it contained, among other things, approximately $415,000 in cash. Another box leased by Dora was found to contain approximately $224,220 in cash.
The charge of obstruction of justice provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000. 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 United States Attorney William D. Weinreb and Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston, made the announcement. Assistant U.S. Attorney Mark J. Balthazard of Weinreb’s Economic Crimes Unit is prosecuting the case.
The details contained in the charging documents are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Owners of Massachusetts Temp Agency Indicted for Failing to Pay over Employment Taxes and Obstructing IRSRead the Press Release
Allegedly Cashed More than $11 Million in Checks to Pay Workers Under the Table
A federal grand jury sitting in the District of Massachusetts returned an indictment on March 22, which was unsealed today, charging two Massachusetts residents who operated a temporary employment agency with conspiring to defraud the government, failing to pay over employment taxes and obstructing the internal revenue laws, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.
According to the indictment, Huong Le and Tien Chau ran an employment agency that provided temporary labor to businesses in Massachusetts and New Hampshire. The agency operated under at least four different names: Central Boston Staffing Services, Metro Boston Staffing Services, General Staffing Inc. and Kim’s Staffing Inc. Le and Chau allegedly used family members and other individuals as nominees to conceal their ownership of the business.
The indictment alleges that from 2006 through 2011, Le and Chau conspired to conceal their agency’s total number of employees from the Internal Revenue Service (IRS) to lower their employment tax liabilities. Le and Chau allegedly attempted to hide the size of their workforce from the IRS by paying most of their employees cash under the table and causing the filing of false employment tax returns that both underreported the number of their employees and did not report wages paid in cash. Le and Chau allegedly cashed over $11 million in client checks at a check cashing facility in Worcester and used their staffing agency’s site supervisors, office manager and drivers to pay their employees in cash.
The indictment further charges that Le and Chau sought to obstruct an investigation by, among other things, directing an employee, after learning of her interview with special agents, to assist them with shredding the agency’s records. Le and Chau also allegedly destroyed and removed computer disks and computers from the business’s office.
An indictment is not a finding of guilt. Individuals charged in indictments are presumed innocent until proven guilty beyond a reasonable doubt.
If convicted, Le and Chau face a statutory maximum sentence of five years in prison for the conspiracy and employment tax counts and three years in prison for obstructing the internal revenue laws. They also face a term of supervised release, restitution and monetary penalties.
Acting Deputy Assistant Attorney General Goldberg thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorneys Brittney Campbell and Shawn Noud of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Oswego Man Sentenced to Seven Years in Prison for Child Pornography CrimesRead the Press Release
SYRACUSE, NEW YORK – James M. Moody, 42, of Oswego, New York, was sentenced today to serve eighty-four (84) months in prison for distributing, receiving and possessing child pornography, announced United States Attorney Richard S. Hartunian and James C. Spero, Special Agent in Charge, Buffalo Field Office of Homeland Security Investigations (HSI).
As part of his guilty plea, Moody admitted that he distributed images of child pornography using a peer-to-peer file-sharing program. On October 23, 2015, investigators searched Moody’s residence, and recovered 60 images and 40 videos depicting child pornography.
United States District Judge David N. Hurd also imposed a lifetime term of supervised release, which will begin following Moody’s release from prison, and ordered payment of a $300 special assessment. The defendant will be required to register as a sex offender upon his release from prison.
This case was investigated by Homeland Security Investigations (HSI) and was prosecuted by Assistant United States Attorney Geoffrey J. L. Brown.
Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS). Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.
Osteopathic Doctor Pleads Guilty in Multi-Million Dollar Health Care Fraud and Money Laundering Scheme Involving Sober Homes and Alcohol and Drug Addiction Treatment CentersRead the Press Release
An osteopathic doctor pled guilty for his participation in a multi-million dollar health care fraud and money laundering scheme that involved the filing of fraudulent insurance claim forms and defrauded health care benefit programs.
Benjamin G. Greenberg, Acting United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Dave Aronberg, State Attorney, Palm Beach County State Attorney’s Office, Jeff Atwater, Florida Chief Financial Officer, William D. Snyder, Sheriff Martin County Sheriff's Office, Robert Koons, Special Agent in Charge, Amtrak Office of Inspector General, Rafiq Ahmad, Special Agent in Charge, United States Department of Labor, Office of Inspector General (DOL-OIG), Isabel Colon, Regional Director, United States Department of Labor, Employee Benefits Security Administration (DOL-EBSA), Dennis Russo, Director of Operations, National Insurance Crime Bureau (NICB), Ric Bradshaw, Sheriff, Palm Beach County Sheriff's Office (PBSO), Sarah Mooney, Chief, West Palm Beach Police Department, Jeffrey S. Goldman, Chief, Delray Beach Police Department, Pam Bondi, Florida Attorney General, and Scott Rezendes, Special Agent in Charge, Office of Personnel Management, Office of Inspector General (OPM-OIG), made the announcement.
Donald Willems, 41, of Weston, pled guilty to one count of conspiring to commit health care fraud, in violation of Title 18, United States Code, Section 1347; all in violation of Tile 18, United States Code, Section 1349. Sentencing is scheduled for June 7, 2017 at 10:00 a.m. before U.S. District Judge Donald M. Middlebrooks. At sentencing, Willems faces up to 10 years in prison.
According to court documents, Willems’ co-defendants established sober homes which were purportedly in the business of providing safe and drug-free residences for individuals suffering from drug and alcohol addiction. To obtain residents for the sober homes, members of the conspiracy provided kickbacks and bribes, in the form of free or reduced rent and other benefits, to individuals with insurance who agreed to reside at the sober homes, attend drug treatment, and submit to regular drug testing that members of the conspiracy could bill to the residents’ insurance plans. Although the sober homes were purportedly drug-free residences, the co-defendants permitted the residents to continue using drugs as long as they attended treatment and submitted to drug testing. The sober homes’ residents were referred to treatment centers that purportedly offered services for persons suffering from alcohol and drug addiction. In most instances, the co-defendants knew that the sober home residents referred to the treatment centers, Journey to Recovery LLC, in Lake Worth, Florida, and Reflections Treatment Center, LLC (Reflections), in Margate, Florida, were using drugs.
Willems was a licensed osteopathic doctor in the State of Florida, and was the medical director of Reflections from October 2015 to May 2016. Instead of defendant Willems using his medical expertise and his individual assessments of patients to decide what type of laboratory testing was needed by each patient, Willems ordered drug treatment and drug testing for the sober home residents, specifically expensive urine and saliva drug screens and allergy testing, regardless of whether such treatment and testing were medically necessary. Willems also falsely documented patient files to make it appear as though he reviewed the test results. If Willems had, in fact, closely monitored the drug test results, he would have realized that most of the patients at Reflections were continuing to abuse drugs and that urine and saliva samples from other people were being substituted for the patients’ urine and saliva samples.
Willems surrendered his DEA number to the Drug Enforcement Administration following his arrest in 2012 for improperly prescribing controlled pain medications, yet defendant Willems prescribed controlled substances, including opioids, to patients at Reflections using DEA numbers assigned to other physicians and prescriptions that contained the forged signatures of another physician.
Willems knew that insurance claims based on his unlawful prescriptions for lab testing, prescription opioids, and other controlled substances, as well as the unlawful claims based upon the treatment occurring at Reflections and Willems’ examinations were submitted to patients’ health insurance plans. During the period of Willems’ term as Medical Director at Reflections, clinical labs and Reflections billed insurance companies in excess of $28 million and received reimbursements from insurance companies in excess of $6.5 million.
Potential victims should call (561) 822-5114 or submit complaints through the IC3 Complaint Form - https://www.ic3.gov/complaint/default.aspx and use the key word “Chatman Reflections” in the “Description of the Incident” field when submitting complaints related to this case.
Mr. Greenberg commended the investigative efforts of the Greater Palm Beach Health Care Fraud Task Force. Agencies of the task force include the FBI, IRS-CI, the Palm Beach County State Attorney's Office Sober Homes Task Force, Florida Division of Investigative and Forensic Services, Martin County Sheriff's Office, Amtrak OIG, DOL-OIG, DOL-EBSA, National Insurance Crime Bureau, Palm Beach County Sheriff's Office, West Palm Beach Police Department, Delray Beach Police Department, Florida Attorney General Office of Statewide Prosecution, and OPM-OIG. The cases are being prosecuted by Assistant United States Attorney A. Marie Villafaña.
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.
North Charleston Man Sentenced to Fifteen Years on Federal Weapons ChargesRead the Press Release
Contact Person: Nick Bianchi (843) 727-4381
Columbia, South Carolina---- United States Attorney Beth Drake stated today that William L. Dodson, age 43, of North Charleston, South Carolina, was sentenced today in federal court in Charleston, South Carolina, for possession of a firearm by a convicted felon. United States District Judge Richard M. Gergel of Charleston sentenced Dodson to fifteen years imprisonment, to be followed by two years’ supervised release.
Evidence presented at the change of plea and sentencing hearings established that officers with the North Charleston Police Department initiated a traffic stop on Dodson and Dodson fled on foot. As Dodson ran from law enforcement, he threw a loaded Beretta 9 mm handgun, along with marijuana and cocaine, which law enforcement recovered after Dodson was apprehended. Dodson has multiple prior felony convictions, including four prior convictions for possessing of narcotics with intent to distribute. Dodson is also awaiting sentencing on state charges of ill treatment of animals after pleading guilty in an unrelated matter in August 2016.
The case was investigated by agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”) and the North Charleston Police Department. Assistant United States Attorney Nick Bianchi of the Charleston office prosecuted the case.
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Nicaraguan Man Sentenced on Kidnapping 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 Timothy Miller, 40, of Managua, Nicaragua, who was convicted of conspiracy to commit international parental kidnapping, was sentenced to time served (eight months) by U.S. District Judge Richard J. Arcara.
Assistant U.S. Attorneys Michael DiGiacomo and Paul Van de Graff, who handled the case, stated that in 2009, the defendant conspired with co-defendants Kenneth Miller and Lisa Miller to assist Lisa Miller and her daughter in fleeing the United States to Nicaragua. Lisa Miller fled the country in order to prevent her partner Janet Jenkins from visiting her daughter. The two women both had parental rights with the child.
Timothy Miller purchased a one-way plane ticket for Lisa Miller and her daughter to travel from Toronto, Ontario to Nicaragua. Upon their arrival in Nicaragua, Timothy Miller assisted Lisa Miller and her daughter with shelter and financial assistance.
Kenneth Miller was convicted and sentenced. Charges are pending against Lisa Miller whose current whereabouts, and that of her daughter, is unknown. 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. In a related prosecution, Philip Zhodiates was convicted of international parental kidnapping and conspiracy to commit international parental kidnapping, and was sentenced to 36 months in prison.
The sentencing is the culmination of an investigation by the Vermont Office of the United States Marshal’s Service, under the direction of David Damag; and the Vermont Office of the Federal Bureau of Investigation, under the direction of Andrew Vale, Special Agent in Charge.
New York Salesman Sentenced to Prison for Fraudulently Selling Vending Machine BusinessesRead the Press Release
A federal judge sentenced a Long Island, New York sales representative to prison for fraudulently selling vending machine businesses, the Justice Department announced today.
Richard Linick, 74, of Setauket, New York, was sentenced to serve 36 months in prison followed by three years of supervised release and ordered to pay $382,126 in restitution by U.S. District Court Judge Joan M. Azrack of the Eastern District of New York. Linick was found guilty after a six-week trial in 2015 of wire fraud and conspiracy. He is one of 22 defendants who have been convicted of fraud in connection with Multivend LLC d/b/a/ Vendstar, which was based in Deer Park, New York.
“The defendant enticed victims to pay thousands of dollars for worthless business opportunities,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “The Department of Justice will continue to prosecute scam artists who defraud Americans out of their savings.”
Vendstar, which closed in July 2010, sold vending machine businesses in which it promised to provide vending machines, candy, locations, and everything else buyers would need. Vendstar advertised in newspapers and on the Internet and sold the businesses to victims nationwide. But Vendstar’s sales representatives – with the knowledge and approval of Vendstar’s managers – misrepresented the business opportunity’s likely profits, the amount of money that Vendstar’s prior customers were earning, how quickly customers were likely to recover their investment, the quality of locations that were available for the vending machines, and the level of location assistance that customers would receive from locating companies recommended by Vendstar. During the last five years it was open, Vendstar made more than $60 million in sales. Buyers received the vending machines, but little else, and typically lost most or all of their investment. Several of those victims testified at trial about the impact that the losses had on them and their families.
Acting Assistant Attorney General Readler commended the U.S. Postal Inspection Service for its thorough investigation. The case was prosecuted by Senior Litigation Counsel Patrick Jasperse and Assistant Director Alan Phelps of the Civil Division’s Consumer Protection Branch. During the last 10 years, approximately 170 individuals have been convicted of fraudulently selling business opportunities in cases prosecuted by the Consumer Protection Branch.
For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch.
New Haven Man Sentenced to 42 Months in Federal Prison for Role in Fraudulent Oxycodone Prescription SchemeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ROBERT WILLIAMS, also known as “Bo,” “Positive” and “Shawn,” 37, of New Haven, was sentenced today by U.S. District Judge Alvin W. Thompson in Hartford to 42 months of imprisonment, followed by three years of supervised release, for his role in a scheme to distribute oxycodone that was obtained through fraudulent prescriptions.
According to court documents and statements made in court, in 2012, members of the Drug Enforcement Administration’s New Haven Tactical Diversion Squad began an investigation into a drug trafficking organization that manufactured fraudulent prescriptions for oxycodone and distributed the drug in the greater New Haven area. As part of the conspiracy, members of organization obtained the personal identifying information of medical practitioners and used the information to create fraudulent prescriptions. Conspiracy members also purchased legitimate prescriptions for oxycodone from individuals. The organization then used individuals, or “runners,” to fill the fraudulent prescriptions at pharmacies throughout Connecticut. Once a runner provided his or her personal information to a member of the organization, the runner’s information was kept on file and used to create other fraudulent prescriptions.
WILLIAMS filled fake prescriptions himself, and also recruited and transported others to fill fake prescriptions for him. He then sold most of the pills he acquired in bulk quantities to others.
The investigation revealed that, between February 2013 and September 2015, the organization stole the personal identifying information of more than 50 doctors and medical professionals and fraudulently obtained more than 80,000 oxycodone pills. Investigators identified more than 800 fraudulent prescriptions passed by members of the organization using more than 270 different “patient” names.
Nearly all of the runners employed by the conspiracy held state-sponsored medical insurance, so the costs of the prescriptions were billed to Medicaid. Members of the drug trafficking organization then sold the oxycodone for $20 to $30 per 30 milligram pill.
Eleven individuals were charged as a result of the investigation.
WILLIAMS was arrested on September 10, 2015, and was in custody until February 9, 2016, when he was released on bond into a drug treatment program. He has been detained since May 18, 2016, after his bond was revoked. On September 19, 2016, he pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute oxycodone.
The DEA Tactical Diversion Squad includes members from the Bristol, Greenwich, Hamden, Milford, New Haven, Shelton, Vernon and Wilton Police Departments.
This case is being prosecuted by Assistant U.S. Attorneys Amy C. Brown and Robert M. Spector.
Nebraska Man Sentenced in Wire Fraud and Tax CasesRead the Press Release
Acting United States Attorney Robert C. Stuart announced that on March 23, 2017, United States District Judge John M. Gerrard sentenced Alan Ostrander, 45 years old of Omaha, Nebraska, to five years’ probation following his guilty pleas to criminal charges of wire fraud and willful failure to file tax returns. The federal prosecution stemmed from actions by Mr. Ostrander while he managed the Big Drive Cattle feed yard near Fullerton NE during 2009 and 2010. Ostrander must pay restitution of $27,876 to Elkhorn Valley Packing for selling its cattle but not paying over to it the proceeds of the sale, and must pay restitution of $20,800 to the former owners of Big Drive Cattle for converting its funds to his own use. Ostrander must also cooperate with the Internal Revenue Service in the determination, calculation, and collection of taxes owed by him for the years 2009 and 2010.
“The term voluntary compliance means that each of us is responsible for filing a tax return when required and for paying the correct amount of tax,” said Karl Stiften, Special Agent in Charge of IRS Criminal Investigation for Nebraska. “This responsibility should not be taken lightly.”
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service.
NW Alabama Pharmacies Owner Sentenced to Six Month’s Home Confinement for Obstructing Medicare Audit; Ordered to Pay $2.5 million FineRead the Press Release
BIRMINGHAM – A federal judge today sentenced the owner of two northwest Alabama pharmacies to six month’s home confinement for obstructing a Medicare audit, ordered him to pay a $2.5 million fine and prohibited him from working in a pharmacy during his year on probation.
U.S. District Court Judge Virginia Emerson Hopkins sentenced RODNEY DALTON LOGAN, 63, of Muscle Shoals, on one count of obstructing a 2012 federal audit of Medicare claims submitted by a pharmacy he owned. Logan pleaded guilty to the charge in August.
Acting U.S. Attorney Robert O. Posey, Department of Justice Criminal Division Acting Assistant Attorney General Kenneth A. Blanco, FBI Special Agent in Charge Roger C. Stanton, Health and Human Services Office of Inspector General Special Agent in Charge Derrick L. Jackson, and Food and Drug Administration Office of Criminal Investigation Special Agent in Charge Robert J. West announced the sentence.
Judge Hopkins sentenced Logan to one year’s probation, but included the six months of home confinement and the prohibition against him working as a pharmacist as special conditions of his probation.
“This defendant falsified documents so that his businesses could keep money improperly billed to Medicare under its Part D prescription drug component,” Posey said. “Medicare is the federal health insurance program for people 65 and older, and for people with disabilities. I applaud the work of the investigative agencies and the prosecutors in this office who have worked at length to bring this defendant to justice.”
Logan is a registered pharmacist who owned Leighton Pharmacy Inc., which did business as Sheffield Pharmacy and Homecare in Sheffield, and Russellville Pharmacy in Russellville. At various times, he was the lead pharmacist at both Sheffield and Russellville, according to is plea.
The Sheffield and Russellville pharmacies operated as both compounding and retail pharmacies. A compounding pharmacy is one that prepares customized medications for individual patients, usually by mixing ingredients in order to create a prescription. The two pharmacies sold compounded prescriptions to patients in Alabama and other states.
According to court documents, including Logan’s plea agreement with the government, he obstructed a 2012 audit of the Sheffield pharmacy’s claims for Medicare reimbursement on compounded prescriptions as follows:
CVS/Caremark Inc. administered prescription drug claims for Medicare Part D and served as an auditor on Medicare’s behalf. Part D prohibited reimbursement to pharmacies for compounded medications made using bulk pharmaceutical powders. Russellville and Sheffield nonetheless sought Part D reimbursement after February 2009 for compounded medications, primarily topical pain creams, made from bulk powders. The pharmacies, however, used the billing code for the tablet or capsule form of the ingredient.
In response to the 2012 audit, Logan caused Sheffield to submit falsified and misleading documents stating that medications in tablet or capsule form were used as ingredients for the compounded prescriptions.
FBI, HHS-OIG and FDA-OCI investigated the case, which Assistant U.S. Attorney Chinelo Diké-Minor and Trial Attorney William S.W. Chang of the Justice Department’s Criminal Division Fraud Section prosecuted.
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Miami-Based Physician Charged for Role in Pain Pill Diversion and Medicare Fraud SchemeRead the Press Release
A physician licensed in Puerto Rico, who was practicing medicine in Miami, was charged in a 16-count indictment unsealed today for his alleged participation in a multi-faceted $20 million health care fraud scheme involving the submission of false and fraudulent claims to Medicare and Medicaid and the illegal distribution of oxycodone and other controlled substances.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Benjamin G. Greenberg of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office and Special Agent in Charge Brian Swain of the United States Secret Service’s (USSS) Miami Field Office made the announcement.
Roberto A. Fernandez, M.D., 51, of Miami, was charged with one count of conspiracy to commit health care fraud and wire fraud, 11 counts of health care fraud, one count of conspiracy to defraud the United States and pay and receive health care bribes and kickbacks, one count of conspiracy to distribute controlled substances and two counts of distribution of controlled substances. Fernandez was arrested on March 22, 2017, and made his initial appearance today before U.S. Magistrate Judge Andrea M. Simonton of the Southern District of Florida.
According to the indictment, from approximately December 2009 to March 2017, Fernandez owned and operated Florida-based Latin Foundation for Health Inc. and purported to practice medicine as an “area of critical need” doctor at Latin Foundation for Health and other facilities in Miami-Dade County.
The indictment alleges that from approximately January 2011 through February 2017, Fernandez referred Medicare beneficiaries and Medicaid recipients who were purportedly under his care to Calan Pharmacy & Discount Service LLC, a Medicare Part D provider, and several Miami-area home health agencies in exchange for illegal bribes and kickbacks from his co-conspirators. The indictment further alleges that Fernandez submitted false and fraudulent claims through Medicare Part B for services, office visits and procedures that he never provided, such as therapeutic injections and removal of lesions from patients’ faces, and provided prescriptions for home health services and medications regardless of whether they were medically necessary.
The indictment further alleges that Fernandez illegally dispensed controlled substances, including but not limited to the Schedule II controlled substances Oxycodone and Hydrocodone and the Schedule IV controlled substance Alprazolam, to his co-conspirators.
According to the indictment, Fernandez and his co-conspirators caused Medicare to pay at least approximately $4.4 million based on false and fraudulent claims that they caused to be submitted. The indictment also alleges that Medicare, through Part D, paid a total of approximately $20 million as a result of claims submitted listing Fernandez as the prescribing physician.
An indictment is merely an allegation and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The FBI, HHS-OIG and USSS investigated the case, which was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. Former Fraud Section Trial Attorney and current Assistant U.S. Attorney Lisa H. Miller of the Southern District of Florida and Fraud Section Trial Attorney Adam G. Yoffie are prosecuting the case.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 3,000 defendants who have collectively billed the Medicare program for more than $11 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
Miami-Based Physician Charged for Role in Pain Pill Diversion and Medicare Fraud SchemesRead the Press Release
A physician licensed in Puerto Rico, who was practicing medicine in Miami, was charged in a 16-count indictment unsealed today for his alleged participation in a multi-faceted $20 million health care fraud scheme involving the submission of false and fraudulent claims to Medicare and Medicaid and the illegal distribution of oxycodone and other controlled substances.
Acting U.S. Attorney Benjamin G. Greenberg of the Southern District of Florida, Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office and Special Agent in Charge Brian Swain of the United States Secret Service’s (USSS) Miami Field Office made the announcement.
Roberto A. Fernandez, M.D., 51, of Miami, was charged with one count of conspiracy to commit health care fraud and wire fraud, 11 counts of health care fraud, one count of conspiracy to defraud the United States and pay and receive health care bribes and kickbacks, one count of conspiracy to distribute controlled substances and two counts of distribution of controlled substances. Fernandez was arrested on March 22, 2017, and made his initial appearance today before U.S. Magistrate Judge Andrea M. Simonton of the Southern District of Florida.
According to the indictment, from approximately December 2009 to March 2017, Fernandez owned and operated Florida-based Latin Foundation for Health Inc. and purported to practice medicine as an “area of critical need” doctor at Latin Foundation for Health and other facilities in Miami-Dade County.
The indictment alleges that from approximately January 2011 through February 2017, Fernandez referred Medicare beneficiaries and Medicaid recipients who were purportedly under his care to Calan Pharmacy & Discount Service LLC, a Medicare Part D provider, and several Miami-area home health agencies in exchange for illegal bribes and kickbacks from his co-conspirators. The indictment further alleges that Fernandez submitted false and fraudulent claims through Medicare Part B for services, office visits and procedures that he never provided, such as therapeutic injections and removal of lesions from patients’ faces, and provided prescriptions for home health services and medications regardless of whether they were medically necessary.
The indictment further alleges that Fernandez illegally dispensed controlled substances, including but not limited to the Schedule II controlled substances Oxycodone and Hydrocodone and the Schedule IV controlled substance Alprazolam, to his co-conspirators.
According to the indictment, Fernandez and his co-conspirators caused Medicare to pay at least approximately $4.4 million based on false and fraudulent claims that they caused to be submitted. The indictment also alleges that Medicare, through Part D, paid a total of approximately $20 million as a result of claims submitted listing Fernandez as the prescribing physician.
An indictment is merely an allegation and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The FBI, HHS-OIG and USSS investigated the case, which was brought as part of the Medicare Fraud Strike Force, supervised by the U.S. Attorney’s Office for the Southern District of Florida and the Criminal Division’s Fraud Section. Former Fraud Section Trial Attorney and current Assistant U.S. Attorney Lisa H. Miller of the Southern District of Florida and Fraud Section Trial Attorney Adam G. Yoffie are prosecuting the case.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 3,000 defendants who have collectively billed the Medicare program for more than $11 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
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.
Mexican Citizen Sentenced for Illegal ReentryRead the Press Release
Roanoke, VIRGINIA – A citizen of Mexico, who had been removed from the United States multiple times in recent years, was sentenced today in the United States District Court for the Western District of Virginia in Roanoke on Federal immigration charges, Acting United States Attorney Rick A. Mountcastle announced.
Martin Alvarez-Torres, 38, a citizen of Mexico, previously pled guilty to one count of illegally reentering the United States after being previously deported without having obtained the express consent of the Attorney General of the United States and the Secretary of the Department of Homeland Security to apply for admission into the United States. Today in District Court, Alvarez-Torres was sentenced to a term of imprisonment of thirty 30 months.
According to evidence presented at previous hearings by Assistant United States Attorney C. Patrick Hogeboom III and Special Assistant United States Attorney Kari Munro Alvarez-Torres had been removed from the United States on six prior occasions, most recently on April 17, 2014. The defendant was indicted in 2014 and remained at-large until his arrest in Roanoke, Virginia in June 2016.
Investigation of the case was conducted by the Department of Homeland Security, Immigration and Customs Enforcement. Assistant United States Attorney C. Patrick Hogeboom III and Special Assistant United States Attorney Kari Munro prosecuted the case for the United States.
Memphis Man Indicted in Scheme to Defraud Financial InstitutionsRead the Press Release
Memphis, TN – A federal grand jury has indicted a Memphis man for committing bank fraud against financial institutions in the Memphis area. Lawrence J. Laurenzi, Acting U.S. Attorney for the Western District of Tennessee, announced the indictment today.
According to the indictment, from August 2011 through February 2016, Talmadge Garner and unknown co-conspirators not charged in the indictment participated in a deceptive scheme to defraud Orion Federal Credit Union, SunTrust Bank and Regions Bank ("Banks"). The fraud consisted of opening new accounts and/or using their existing accounts to deposit fraudulent checks. Garner also stole the identities of individuals to pass fraudulent checks to the Banks.
Nearly 200 fraudulent closed account checks totaling $110,831.95 were deposited into accounts at the Banks. Immediately after deposits were made in the Banks, withdrawals were made by Garner and others not named in the indictment. Garner would give co-conspirators some of the proceeds withdrawn from the Banks.
The Indictment records (31) counts of fraudulent transactions involving Garner and unknown co-conspirators during the five-year period. The maximum penalty for bank fraud is (30) years in prison and a $1,000,000 fine.
The case was investigated by the United States Secret Service. Assistant U.S. Attorney Damon Keith Griffin is prosecuting this case on the government’s behalf.
Lock Haven Woman Indicted for Embezzling Customer Certificate of DepositRead the Press Release
WILLIAMSPORT – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Jolene Edwards, age 38, of Lock Haven, Pennsylvania, was indicted by a federal grand jury with bank fraud, embezzlement by a bank employee, and interstate transportation of stolen property.
According to United States Attorney Bruce D. Brandler, the indictment alleges that while Edwards worked as a customer service representative and assistant branch manager at Jersey Shore State Bank (JSSB), Edwards embezzled and fraudulently converted $52,222 in funds from a customer’s certificate of deposit account. According to the indictment, instead of transferring the funds to a new certificate of deposit account at M&T Bank, Edwards used the funds to pay her credit card bills, repay personal loans, and to make purchases for family members. The scheme to embezzle and fraudulently convert the customer’s funds started in June 2012 and continued through March 2015.
This matter was investigated by the Federal Bureau of Investigation. Assistant U.S. Attorney George J. Rocktashel is prosecuting the case.
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is 30 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Lancaster Man Charged with Theft of Government FundsRead the Press Release
Elsie Reyes, a/k/a “Elsie Yera”, 59, of Lancaster, Pennsylvania, was charged today by Information with one count of theft of government funds, announced Acting United States Attorney Louis D. Lappen. According to the Information[1], the defendant concealed her July 1994 marriage from the Social Security Administration in order to receive more Supplemental Security Income benefits than what she was entitled to. The defendant’s alleged actions resulted in a loss to the government of approximately $136,246.70.
If convicted, the defendant faces a period of incarceration, a 3‑year period of supervised release, restitution to the government of $136,246.70, a $250,000 fine, and a $100 special assessment.
The case was investigated by the Social Security Administration, Office of Inspector General, and is being prosecuted by Assistant United States Attorney Amanda R. Reinitz.
[1] An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Kentwood Man Sentenced for Methamphetamine PossessionRead the Press Release
Acting U.S. Attorney Duane A. Evans announced that ERIC BROWN, age 38, from Kentwood, was sentenced today after previously pleading guilty to one count of Possession with Intent to Distribute a Quantity of Methamphetamine.
U.S. District Judge Nannette Jolivette Brown sentenced BROWN to time served (30 months). Additionally, BROWN was sentenced to 3 years of supervised release.
According to court documents, on June 22, 2014, a Tangipahoa Parish Sheriff’s deputy responded to a suspicious person report at 69062 South River Road in Kentwood. When the deputy arrived at the residence, he observed individuals flee the residence. The deputy then noticed several males outside the rear of the residence. As the deputy approached the rear of the residence, he detected an odor consistent with the manufacturing of methamphetamine. Four individuals were outside the rear of the residence, including BROWN, who was sitting in a white Lincoln. The deputy then noticed in plain view of the vehicle twenty-four zip-lock baggies containing approximately three grams of methamphetamine and a Smith and Wesson .38 special revolver on the vehicle’s floorboard.
The deputy then met with a female at the residence who told the deputy that she and BROWN resided at the residence and that BROWN “cooked” methamphetamine in their bedroom the previous night. Deputies and DEA Task Force Officers searched the residence and found three inactive methamphetamine labs in a refrigerator in the master bedroom.
Acting U.S. Attorney Evans praised the work of the U.S. Drug Enforcement Administration and the Tangipahoa Parish Sheriff’s Office in investigating this matter. Assistant U.S. Attorney Andre’ Jones was in charge of the prosecution.
Justice Department Settles Civil Antitrust Claim Against AT&T and DIRECTV for Orchestrating Information Sharing Agreements with CompetitorsRead the Press Release
Settlement Bars Anticompetitive Information Sharing Between Competitors
The Department of Justice announced today that it has reached a settlement that will prohibit DIRECTV and its parent corporation, AT&T, from illegally sharing confidential, forward-looking information with competitors.
The department’s Antitrust Division filed suit on Nov. 2, 2016, alleging that DIRECTV was the ringleader of a series of unlawful information exchanges between DIRECTV and three of its competitors – Cox Communications Inc., Charter Communications Inc. and AT&T (before it acquired DIRECTV) – during the companies’ negotiations to carry the SportsNet LA “Dodgers Channel.” SportsNet LA holds the exclusive rights to telecast almost all live Dodgers games in the Los Angeles area.
The settlement, which will obtain all of the relief sought by the department in its lawsuit, will ensure that when DIRECTV and AT&T negotiate with providers of video programming, including negotiations to telecast the Dodgers Channel, they will not illegally share competitively-sensitive information with their rivals. The settlement also requires the companies to monitor certain communications their programming executives have with their rivals, and to implement antitrust training and compliance programs.
“When competitors email, text, or otherwise share confidential and strategically sensitive information with each other to avoid competing, consumers lose,” said Acting Assistant Attorney General Brent Snyder of the Justice Department’s Antitrust Division. “Today’s settlement promotes competition among pay-television providers and prevents AT&T and DIRECTV from engaging in illegal conduct that thwarts the competitive process.”
According to the Complaint, DIRECTV’s Chief Content Officer, Daniel York, unlawfully exchanged competitively-sensitive information with his counterparts at Cox, Charter and AT&T while they were each negotiating for the right to telecast the Dodgers Channel. The companies engaged in these unlawful information exchanges to decrease the risk that any individual company would lose subscribers by not carrying the Dodgers Channel while others did. Eliminating this threat corrupted the competitive bargaining process and likely contributed to the lengthy blackout.
DIRECTV Group Holdings, LLC is a subsidiary of AT&T Inc., a Delaware corporation with headquarters in Dallas. As of 2014, DIRECTV had approximately 1.25 million video subscribers in the Los Angeles area. AT&T is a Delaware corporation with headquarters located in Dallas. As of 2014, AT&T had approximately 400,000 video subscribers in the Los Angeles area.The proposed settlement agreement, along with the department’s competitive impact statement, will be published in the Federal Register as required by the Antitrust Penalties and Procedures Act. Any person may submit written comments concerning the proposed settlement within 60 days of its publication to Scott Scheele, Chief, Telecommunications and Media Enforcement Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 7000, Washington, DC 20530. At the conclusion of the 60-day comment period, the court may enter the final judgment upon finding that it serves the public interest.
Anyone with information related to anticompetitive conduct should contact the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258 or visit www.justice.gov/atr/contact/newcase.html.
Dodgers CIS Dodgers Explanation Dodgers Proposed Final Judgement Dodgers Stipulation & Order Dodgers Stipulation & OrderJury Convicts Two Men in Pasadena Bank RobberyRead the Press Release
HOUSTON - A federal jury sitting in Houston has found two Houston men guilty for the attempted robbery and robbery of the Shared Resources Credit Union and for using and carrying a firearm during commission of the crimes, announced Acting U.S. Attorney Abe Martinez. The federal jury deliberated for less than five hours before convicting Raynard Gray, 33, and Sonny Pervis, 27, both of Houston, on all counts as charged following a three-day-trial.
A total of seven men met and planned the robbery of the credit union. The jury heard Gray was the leader of this robbery crew and acted as a lookout during the robberies, while Pervis was one of the men who entered the credit union and brandished and discharged a firearm.
They arrived at the bank first on Saturday, July 26, 2014, with the intention of committing the robbery. The jury heard that employees inside the bank observed the men with the firearms as they approached. However, the doors to the lobby were locked so the crew left, but returned two days later to complete the crime.
The men fled the scene after stealing the money on July 28. A civilian followed them in order to give police the vehicle information of the robbers, during which time Howard Glaze, 24, of Houston, and Pervis discharged their firearms in a neighborhood in his direction. The group then led officers on a high-speed chase from Pasadena to north Houston, where they abandoned their vehicle and fled on foot. Glaze was soon apprehended. The investigation later led to the discovery and arrest of the others.
During trial, the jury saw surveillance videos, photos and police dash camera footage of the high speed chase and heard testimony from 12 witnesses. They also heard from a sergeant with the Pasadena Police Department who collected cash, bank straps and clothing of the robbers from the abandoned vehicle. The officer was also able to lift a fingerprint off a trash bag found in that vehicle, which belonged to Pervis.
The defense did not dispute that the robberies occurred, but contended that Pervis and Gray were not involved. The jury was not convinced and convicted them on all charges.
U.S. District Judge Sim Lake presided over the trial and set sentencing for June 15, 2017. At that time, Pervis and Gray face up to 25 years for the attempted robbery and robbery of the credit union. They will also face a mandatory and consecutive five years for using a firearm in the attempted robbery and another mandatory 25 years for using a firearm during the actual robbery which must be served consecutively to the bank robbery conviction and to the other firearms charge. They will remain in custody pending sentencing.
The remaining five co-defendants - Chris Braziel, 29, Keith McGee,26, Glaze, Kwhun Johnson, 24, and Leroy Richardson, 36, all of Houston, previously pleaded guilty to their roles in the robberies and will also be sentenced on that date.
The FBI and police departments in Pasadena and Houston conducted the investigation. Assistant U.S. Attorneys Richard Hanes and Heather Winter are prosecuting the case.
Jury Convicts Columbia Man of Child ExploitationRead the Press Release
JEFFERSON CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced today that a Columbia, Mo., man has been convicted in federal court on charges related to child pornography and the sexual exploitation of a minor.
Jayme Nathaniel Walker, 42, of Columbia, was found guilty of producing child pornography, receiving child pornography and transferring obscene materials to a minor.
Evidence introduced during the trial indicated that Walker communicated with a 14-to-15-year-old victim in Illinois, texting and exchanging pornographic photos and videos. The investigation began on June 13, 2014, when the child victim’s parents contacted Illinois State Police officers. The parents turned over a laptop computer, two cell phones and an iPod to investigators.
The child victim gave information to the investigators regarding his online relationship with Walker. He stated that he never met Walker in person, although they talked about meeting several times. He stated that he told Walker his true age. They had numerous conversations, including sexual conversations, and exchanged sexually explicit photos and videos.
Investigators discovered 77 images and six videos exchanged between Walker and the child victim.
Following the presentation of evidence, the jury in the U.S. District Court in Jefferson City, Mo., deliberated for about one and a half hours before returning the guilty verdicts to U.S. District Judge Roseann Ketchmark on Wednesday, March 22, 2017, ending a trial that began Monday, March 20, 2017.
Under federal statutes, Walker is subject to a mandatory minimum sentence of 15 years in federal prison without parole, up to a sentence of 60 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorneys Ashley Turner and Jim Lynn. It was investigated by the FBI, the Boone County, Mo., Sheriff’s Department and the Illinois State Police.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Investment Adviser and Broker Found Guilty in Manhattan Federal Court of Securities Fraud, Wire Fraud, Conspiracy and Aggravated Identity Theft ChargesRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that CHRISTOPHER CERVINO, a/k/a “Smitty,” and SHEIK F. KHAN, a/k/a “Abida Khan,” were found guilty yesterday afternoon in Manhattan federal court after a three-week jury trial before U.S. District Judge Andrew L. Carter, Jr. for their roles in a securities fraud scheme involving a publicly traded over-the-counter company called VGTel, Inc. (“VGTL”).
Acting U.S. Attorney Joon H. Kim said: “Yesterday, a unanimous jury found Sheik Khan, an investment adviser, and Christopher Cervino, a registered broker, guilty of securities fraud relating to a company called VGTel. The stock fraud scheme Khan and Cervino participated in defrauded 100 investors of more than $15 million, including nearly $5 million from Khan’s clients. For their roles in the scheme, Khan and Cervino now stand convicted of federal crimes.”
According to the Indictment, other filings in Manhattan federal court, and the evidence presented at trial:
The VGTL scheme was conceived and led by Edward Durante, a recidivist securities fraud defendant who pleaded guilty in August 2016 to various crimes related to VGTL, including conspiracy, securities fraud, money laundering and perjury. The defendants’ efforts to artificially inflate the market for VGTL increased the stock price from approximately $.25 per share in April 2012 to as much as $1.90, and dramatically inflated the trading volume, which increased the defendants’ abilities to raise private investments in VGTL. To compensate CERVINO for his efforts to control and manipulate the market in VGTL, Durante made at least two cash payments to CERVINO totaling $35,000, in addition to the substantial commissions Cervino received for executing trades in VGTL. For her part, KHAN received more than $400,000 from Durante, including more than $100,000 in payments for liquidating her clients’ investments in safe annuities so that the money could then be invested into VGTL. KHAN’s clients lost virtually the entirety of their investments in VGTL.
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CERVINO, 44, of Franklin Lakes, New Jersey, and KHAN, 50, of Las Vegas, Nevada, were each convicted of one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison; one count of securities fraud, which carries a maximum sentence of 20 years in prison; one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison; and one count of wire fraud, which carries a maximum sentence of 20 years in prison. In addition to these charges, KHAN was also convicted of investment adviser fraud, which carries a maximum sentence of five years in prison, and aggravated identity theft crimes, which carries a mandatory sentence of two years in prison.
The statutory maximum sentences 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 work of the Federal Bureau of Investigation and the U.S. Postal Inspection Service, and thanked the Securities and Exchange Commission for its assistance.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Andrea M. Griswold, Rebecca Mermelstein, and Daniel Goldman are in charge of the prosecution.
Inver Grove Heights Chiropractor Charged in No-Fault Automobile Insurance Fraud SchemeRead the Press Release
Acting United States Attorney Gregory G. Brooker today announced a federal indictment charging TIMOTHY WAYNE GUTHMAN, 43, a licensed chiropractor, with one count of conspiracy to commit health care fraud and one count of mail fraud. GUTHMAN made his initial appearance last week in U.S. District Court in Minneapolis.
Under the Minnesota No-Fault Automobile Insurance Act, auto insurance policies must include a personal injury protection provision (PIP). The PIP provision carries a minimum coverage amount of $40,000 for expenses resulting from injuries sustained in an automobile accident, $20,000 of which may be used for medical expenses.
According to the indictment, from 2012 through 2015, GUTHMAN engaged in a scheme to defraud automobile insurance companies by submitting fraudulent no-fault insurance claims and receiving reimbursements through his chiropractic clinics. These claims were for services that either were not medically necessary or were never rendered. GUTHMAN prescribed and purportedly provided services that were not determined medically necessary by the physical condition of each patient, but were instead designed to fraudulently maximize reimbursement from the patients’ automobile insurance companies.
According to the indictment, in order to get more patients to come to chiropractic appointments for treatment they did not need, GUTHMAN would make illegal kickback payments to patient recruiters, known as “runners.” The kickback payments typically ranged between $500 and $1,500 per automobile accident patient that the runner brought to GUTHMAN’S clinics. GUTHMAN would often require a refund of the kickback payment if the patient failed to attend a minimum number of treatment sessions. In order to keep the patients coming back for medically unnecessary appointments, the runners often paid illegal kickbacks to the patients.
This case is the result of an investigation conducted by the Minnesota Department of Commerce Fraud Bureau and the FBI.
Assistant U.S. Attorneys John E. Kokkinen and David M. Maria are prosecuting the case.
Defendant Information:
TIMOTHY WAYNE GUTHMAN, 43
Inver Grove Heights, Minn.
Charges:
- Conspiracy to commit health care fraud, 1 count
- Conspiracy to commit mail fraud, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Houston Couple Sentenced for Violations of Federal Drug LawsRead the Press Release
Acting U.S. Attorney Duane A. Evans announced that MICHAEL TAYLOR, age 48, and LESLIE PECK, age 35, both of Houston, Texas, were sentenced today after previously pleading guilty to a two-count Indictment for violations of the Federal Controlled Substances Act. TAYLOR and PECK each pled guilty to conspiring to distribute and to possess with intent to distribute 500 grams or more of a mixture or substance containing methamphetamine and distributing 50 grams or more of a mixture or substance containing methamphetamine.
U.S. District Judge Carl J. Barbier sentenced TAYLOR to 120 months imprisonment, followed by 5 years of supervised release. PECK was sentenced to 60 months imprisonment, followed by 4 years of supervised release.
Acting U.S. Attorney Evans praised the work of the Drug Enforcement Administration, with assistance from the Terrebonne Parish Sheriff’s Office and Louisiana State Police, in investigating this matter. Assistant U.S. Attorney Brandon S. Long was in charge of the prosecution
Honduran Man Pleads Guilty to Illegal Re-EntryRead the Press Release
Acting U.S. Attorney Duane A. Evans announced that LUIS GABRIEL RODRIGUEZ-RUIZ, age 33, a citizen of Honduras, pled guilty today to a one-count Indictment charging him with illegal re-entry of a removed alien.
According to court documents, on December 13, 2016, RODRIGUEZ-RUIZ was found in the United States after having been deported previously on February 14, 2013.
RODRIGUEZ_RUIZ faces a maximum term of imprisonment of two years and a fine of $250,000, or the greater of twice the gross gain to the defendant, one year supervised release after imprisonment, and a $100 special assessment. U.S. District Judge Nannette Jolivette Brown set sentencing for May 18, 2017.
Acting U.S. Attorney Evans praised the work of the Immigration and Customs Enforcement in investigating this matter. Assistant United States Attorney Emily K. Greenfield is in charge of the prosecution.
Hartford Man Pleads Guilty to Heroin Distribution Charge Stemming from Enfield Overdose DeathRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, and Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration for New England, announced that AARON GYAMBIBI, also known as “E,” 26, of Hartford, pleaded guilty today in New Haven federal court to one count of possession with intent to distribute, and distribution of, heroin.
This prosecution is part of an ongoing statewide initiative targeting narcotics dealers who distribute heroin, fentanyl or opioids that cause death or serious injury to users.
According to court documents and statements made in court, on May 7, 2016, a 31-year-old male died of suspected drug overdose at an Enfield residence. Enfield Police seized a quantity of heroin and narcotics paraphernalia from the scene.
The Office of the Chief Medical Examiner for the State of Connecticut subsequently determined that the victim died from acute heroin and fentanyl toxicities.
The investigation, which included analysis of the victim’s cellphone, revealed that the heroin ingested by the victim shortly before his death was purchased from GYAMBIBI.
GYAMBIBI has been detained since his arrest on November 16, 2016. He is scheduled to be sentenced by Chief U.S. District Judge Janet C. Hall on July 6, 2017, at which time he faces a maximum term of imprisonment of 20 years.
This matter is being investigated by the Drug Enforcement Administration’s Tactical Diversion Squad and the Enfield Police Department. The Tactical Diversion Squad includes participants from the New Haven, Hamden, Greenwich, Shelton, Bristol, Vernon, Wilton, Milford, Monroe, Fairfield and Manchester Police Departments, and the Connecticut State Police.
This case is being prosecuted by Assistant U.S. Attorney H. Gordon Hall.
Gregg County Mother and Son Indicted for Student Financial Aid FraudRead the Press Release
TYLER, Texas – A Longview, Texas mother and son have been indicted on federal charges in the Eastern District of Texas, announced Acting U.S. Attorney Brit Featherson today.
Gracie Brisco, 54, and her son, Robert Brisco, 29, were indicted by a federal grand jury on Mar. 22, 2017, and charged with multiple counts of student financial aid fraud.
According to the indictment, between June 2013 and September 2015, Gracie Brisco and Robert Brisco, aided and abetted by each other and others, knowingly and willfully misapplied, stole, and obtained by fraud, false statement, and forgery funds, assets, and property provided and insured under the Pell Grant Program and the William D. Ford Federal Direct Loan Programs.
If convicted, the defendants face up to five years in federal prison. The maximum statutory sentence prescribed by Congress is provided here for information purposes, as the sentencing will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the U.S. Probation Office.
This case is being investigated by the U.S. Department of Education - Office of Inspector General, U.S. Secret Service, U.S. Postal Inspection Service, the Longview Police Department, and the Kilgore College Police Department and prosecuted by Assistant U.S. Attorney Nathanial Kummerfeld.
A grand jury indictment is not evidence of guilt. A defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Greenville Man Pleads Guilty to Possession of a Firearm and AmmunitionRead the Press Release
Contact Person: Max Cauthen, II (864) 282-2100
Greenville, South Carolina---- United States Attorney Beth Drake stated today that Anthony Devon Myrick, age 25, of Greenville, South Carolina, pled guilty in federal court in Greenville, for being a felon in possession of a firearm, a violation of 18 U.S.C. 922(g). United States District Court Judge Bruce H. Hendricks of Charleston accepted the plea and will impose sentence after she has reviewed the presentence report, which will be prepared by the U.S. Probation Office. Myrick faces a statutory maximum sentence of ten years in federal prison.
Evidence presented by the government during the plea established that on October 21, 2016, members of the Greenville Sheriff’s Office (GCSO), stopped to investigate a car stopped on the shoulder of the road. As a deputy approached the car, he observed two people in the back seat. As Myrick was exiting the vehicle, a Smith and Wesson 9mm pistol fell from his pants.
Prior to that date, Myrick had previously been convicted of a crime for which he could have received more than a year in prison. Agents confirmed that he had not received a pardon.
Myrick was arrested federally as a part of “Operation Real-Time.” The goal of this program is to identify individuals for federal prosecution with significant criminal histories who continue to actively possess firearms in the Upstate community.
In addition to the Greenville County Sheriff’s Office and the Bureau of Alcohol, Tobacco, and Firearms, Real Time’s core partners include the Greenville Police Department, the Anderson Police Department; the South Carolina Department of Probation, Parole, and Pardon Services; the South Carolina Highway Patrol; United States Probation; the Department of Homeland Security; the Federal Bureau of Investigation; the Drug Enforcement Administration; the 13th Circuit Solicitor’s Office; and the United States Attorney’s Office.
Since August of 2015, the initiative has resulted in the expedited federal prosecution of some 90 defendants and seizure of approximately 110 firearms as well as assorted ammunition from prohibited persons.
U.S. Attorney Beth Drake commended the partnership between the state and federal agencies that led to the Bureau of Alcohol, Tobacco and Firearms and the U.S. Attorney’s Office adopting the case, “We work best when we work together. This ‘real time’ identification of high risk offenders is smart policing, and we welcome the opportunity to work alongside our state chiefs and sheriffs in taking violent repeat offenders out of our communities.”
The Greenville County Sheriff’s Office along with agents from the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) investigated the case. The case is assigned to Assistant United States Attorney Max Cauthen in the Greenville U.S. Attorney’s Office.
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