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18 April 2017
Three Indicted in Florida for Using Stolen IDs to File Tax Returns Claiming More Than $6.8 Million in Fraudulent RefundsRead the Press Release
A federal grand jury returned an indictment on Feb. 9, which was unsealed today, charging three men in Florida, with conspiracy, wire fraud and aggravated identity theft, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida.
According to the indictment, from approximately 2008 through January 2015, in Broward and Miami-Dade counties, Florida, Israel Tassy, Evens Julien, and Jean Leroy Destine, used stolen IDs, including the personal identifying information of deceased individuals, to file over 2,000 tax returns with the Internal Revenue Service (IRS) claiming more than $6.8 million in fraudulent refunds. The indictment alleges that Tassy, Julien and Destine recruited and paid others to obtain Electronic Filing Identification Numbers (EFINs) from the IRS, in their names and the names of businesses, and used these EFINs to file the fraudulent returns. The indictment also charges that in approximately February 2011, Julien registered A Tax Financial Services Inc., as a for-profit corporation with the state of Florida, and used it to file fraudulent returns as well.
Julien and Destine were arrested earlier today and Tassy is still being sought.
An indictment is not a finding of guilt. It merely alleges that crimes have been committed. A defendant is presumed innocent until proven guilty beyond a reasonable doubt.
If convicted, Tassy, Julien and Destine face a statutory maximum sentence of five years in prison on the conspiracy charge, a maximum sentence of 20 years in prison for each count of wire fraud and a mandatory sentence of two years in prison for each count of aggravated identity theft. In addition, all three defendants face a term of supervised release, restitution and monetary penalties.
Acting Deputy Assistant Attorney General Goldberg and Acting U.S. Attorney Greenberg thanked special agents of the IRS-Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Neil Karadbil and Assistant Chief Greg Tortella 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.
Texas Man Sentenced for Transportation of Child PornographyRead the Press Release
Acting U.S. Attorney Duane A. Evans announced that JAMES PUCKETT, age 46, of Livingston, Texas, was sentenced today for crimes involving the sexual exploitation of children.
U.S. District Judge Jay Zainey sentenced PUCKETT to five years’ incarceration, followed by fifteen years of supervised release. PUCKETT will also be required to register as a sex offender pursuant to the Sex Offender Registration and Notification Act.
According to court documents, PUCKETT, who worked as a crewman on an offshore vessel, transported child pornography from Texas to Louisiana in April 2016. HSI computer forensic examiners located images depicting the sexual victimization of children on the defendant’s Padfone X Mini after he was encountered by federal agents at Port Fourchon. The images transported by PUCKETT contained images depicting the rape, bondage, and sexual exploitation of pre-pubescent children.
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.”
Acting U.S. Attorney Evans praised the work of the U.S. Department of Homeland Security, Homeland Security Investigations in investigating this matter. The prosecution of this case is being handled by Project Safe Childhood Coordinator and Fraud Section Chief, Assistant U. S. Attorney Brian M. Klebba.
Tampa Woman Sentenced to Prison for Stolen Identity Refund FraudRead the Press Release
Tampa, Florida – U.S. District Judge James S. Moody, Jr. today sentenced Melissa Hayes (36, Tampa) to 27 months in federal prison for conspiracy to commit theft of government property and identity theft. She pleaded guilty on November 1, 2016.
According to court documents, Hayes conspired with others to commit stolen identity refund fraud by depositing U.S. Treasury checks in the names of others into a business bank account that had been established for her restaurant/food business. She then withdrew the funds the same day or the following day, spent the money on point-of-purchase items, or transferred the money to her personal bank account. The Treasury checks were fraudulently endorsed with the name of the intended recipient (the victim) and the name of Hayes’s business prior to being deposited. Four of the persons named on these Treasury checks were deceased.
Between January and June 2012, Hayes deposited 22 fraudulent government and tax refund checks, totaling over $160,000, into her business bank account. She used these fraudulently obtained funds for personal use and shared them with her co-conspirators.
This case was investigated by the Internal Revenue Service - Criminal Investigation. It was prosecuted by Assistant United States Attorney Kelley C. Howard-Allen.
Tampa Man Pleads Guilty to Firearms OffensesRead the Press Release
Tampa, Florida – Acting United States Attorney W. Stephen Muldrow announces that Aaron Clinton Westbrooks (41, Tampa) today pleaded guilty to three counts of being a felon in possession of a firearm and ammunition. He faces a maximum penalty of 10 years in federal prison on each count. A sentencing date has not yet been set.
According to court documents, on three separate occasions, Westbrooks sold pistols and ammunition to an undercover detective. These transactions took place at various locations in Tampa. At the time of the offenses, Westbrooks had several prior felony convictions and therefore is prohibited from possessing a firearm or ammunition under federal law.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Hillsborough County Sheriff’s Office. It is being prosecuted by Assistant United States Attorney Taylor G. Stout.
This is another case prosecuted as a part of the Department of Justice’s “Project Safe Neighborhoods” Program - a nationwide, gun-violence reduction strategy. Acting United States Attorney Muldrow, along with Daryl R. McCrary, Special Agent in Charge, ATF, is coordinating the Project Safe Neighborhoods effort here in the Middle District of Florida in cooperation with federal, state, and local law enforcement officials.
Tampa Man Charged with Trafficking in Credit Card Manufacturing EquipmentRead the Press Release
Jacksonville, Florida – Acting United States Attorney W. Stephen Muldrow announces the return of an
indictment charging Joseph Xavier Murphy (27, Tampa) with trafficking in credit card manufacturing equipment. If convicted, he faces a maximum penalty of 15 years in federal prison. Murphy was arrested by law enforcement this morning. He made his initial appearance in federal court and was temporarily detained. A detention hearing and arraignment are set for 1:30 p.m. on Friday, April 21, 2017.An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Starke Police Department and the U.S. Secret Service - Jacksonville Field Office. It will be prosecuted by Assistant United States Attorney Kevin C. Frein.
Springfield Man Pleads Guilty to Meth ConspiracyRead the Press Release
SPRINGFIELD, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced that a Springfield, Mo., man pleaded guilty in federal court today to his role in a conspiracy to distribute large quantities of methamphetamine that was shipped from California.
John R. Waits, 46, of Springfield, pleaded guilty before U.S. Magistrate Judge David P. Rush to the charge contained in a Dec. 9, 2015, federal indictment.
Co-defendants Michael E. Ford, 37, and Lisa Renae Thompson, 39, both of Springfield, have also pleaded guilty to their roles in the drug-trafficking conspiracy. Thompson was sentenced to 11 years and three months in federal prison without parole. Ford, who also pleaded guilty to possessing a firearm in furtherance of that drug-trafficking conspiracy, awaits sentencing.
By pleading guilty today, Waits admitted that he participated in a conspiracy to distribute methamphetamine from June 1 through Sept. 11, 2015. A co-conspirator shipped methamphetamine from California to Springfield in two- to two-and-a-half-pound increments to Thompson. Thompson picked up the packages at various hotels in the Springfield area then contacted Ford. Ford picked up the methamphetamine from Thompson and distributed it to others.
After a few days, Ford would then meet with Thompson and give her $10,800. Thompson kept $800 and sent $10,000 to the co-conspirator in California.
Thompson admitted that she received approximately 24 pounds of methamphetamine, which she gave to Ford. Thompson also kept some of the methamphetamine and sold it directly to others with the assistance of Waits. Today’s plea agreement cites several instances in which Waits sold methamphetamine to an undercover agent. He participated in the conspiracy for six weeks and is responsible for the distribution of 12 pounds of methamphetamine.
After Thompson was arrested on Sept. 11, 2015, Ford began receiving methamphetamine shipments from the co-conspirator in California. On Sept. 30, 2015, the Springfield Police Department received a phone call from a FedEx employee about a suspicious package. Police officers delivered the 2.2-pound package of methamphetamine to Ford at a Springfield residence, where he was arrested. Ford had a Ruger .22-caliber handgun in his possession.
Under federal statutes, Waits is subject to a mandatory minimum sentence of 10 years in federal prison without parole, up to a sentence of life in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendants will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Abram McGull II. It was investigated by the Drug Enforcement Administration and the Springfield, Mo., Police Department.
South Florida Man Sentenced to 60 Months in Prison for Tax Return FraudRead the Press Release
TALLAHASSEE, FLORIDA – Roosevelt Williams Jr., 25, of Miami, Florida, has been sentenced to 60 months in federal prison after pleading guilty in December 2016 for crimes arising from the filing of fraudulent federal income tax returns. The sentence was announced by Christopher P. Canova, United States Attorney for the Northern District of Florida.
Consecutive sentences were imposed of 36 months in custody on each of 12 counts of fraudulently taking federal funds and 24 months for using the identities of other persons in the scheme. Williams was also ordered to pay $207,882 in restitution.
Evidence presented in court reflected that in October 2011, Williams was caught on FSU’s campus with 14 debit cards in other people’s names. In July 2013, he was caught with 18 additional debit cards issued to people other than himself, as well as a loaded pistol and $14,300 in cash near the Atlanta airport. He was stopped in Atlanta for driving more than 30 mph above the speed limit. Each of the debit cards reflected a fraudulent attempt to obtain a tax refund based upon another person’s identity. A laptop computer and documents seized in Atlanta contained more than 100 stolen identities, as well as numerous visits to tax return filing websites and to websites where details of identity could be verified.
U.S. Attorney Canova applauded the investigative agencies whose joint efforts led to this successful prosecution, including the Internal Revenue Service – Criminal Investigation, the United States Secret Service, the Florida State University Police Department, the Tallahassee Police Department, and the Clayton County Sheriff’s Office (Georgia). Mr. Canova noted that this was a timely reminder of the importance of filing accurate and honest income tax returns, and that efforts to steal federal funds have serious consequences. This case was prosecuted by Assistant U. S. Attorney Michael T. Simpson.
The United States Attorney’s Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
For more information, contact: Amy Alexander, Public Information OfficerSix More Aliens Indicted on Immigration and Fraud ViolationsRead the Press Release
RALEIGH – John Stuart Bruce, United States Attorney for the Eastern District of North Carolina, announces that a federal grand jury in Raleigh has returned indictments charging RAUNEL BENITEZ-GOROSTIETA, age 42, of Mexico, ENRIQUE ESTRADA-NOYOLA, age 43, of Mexico, JONATAN GONZALEZ-VELASQUEZ, age 24, of Mexico, JORGE HERNANDEZ-BARAHONA, age 41, of Mexico, SILVESTER ROGEL-GANDARIA, age 34, of Mexico, and JOSE ALBERTO TREVINO-CHAVEZ, age 58, of Mexico, with Illegal Reentry of a Deported Alien.
If convicted of Illegal Reentry of a Deported Alien, ESTRADA-NOYOLA, GONZALEZ-VELASQUEZ, HERNANDEZ-BARAHONA, and ROGEL-GANDARIA, would face maximum penalties of two years’ imprisonment, a $250,000 fine, and a term of supervised release following any term of imprisonment.
TREVINO-CHAVEZ is alleged to have been previously deported subsequent to a felony conviction (trafficking in marijuana by possession). Therefore, if convicted, he faces a maximum imprisonment term of 10 years, a $250,000 fine, and a term of supervised release following any term of imprisonment.
BENITEZ-GOROSTIETA is alleged to have been previously deported subsequent to an aggravated felony conviction (voluntary manslaughter). Therefore, if convicted, he faces a maximum imprisonment term of twenty years, a $250,000 fine, and a term of supervised release following any term of imprisonment.
The charges and allegations contained in the indictments are merely accusations. The defendants are presumed innocent unless and until proven guilty in a court of law.
The cases are being investigated by the Department of Homeland Security.
Sierra County Man Sentenced for Federal Methamphetamine Trafficking ConvictionRead the Press Release
ALBUQUERQUE – Ruben David Martinez, III, 29, of Truth or Consequences, N.M., was sentenced yesterday in federal court in Las Cruces, N.M., to 39 months in prison for his conviction on methamphetamine trafficking charges. Martinez will be on supervised release for three years following his prison sentence.
Martinez was arrested in May 2016, and was charged by criminal complaint with possessing methamphetamine and heroin with intent to distribute. According to the criminal complaint, Martinez committed the offenses on May 16, 2016, in Sierra County, N.M., by throwing plastic bags containing more than 40 grams of methamphetamine and 9.22 grams of heroin from his vehicle while fleeing from law enforcement officers who were attempting to execute a traffic stop on his vehicle. After the officers arrested Martinez, they executed a search warrant on his vehicle and residence and seized an additional 69.8 grams of methamphetamine, pills, multiple cellular phones, cash and drug paraphernalia.
On Aug. 30, 2016, Martinez pled guilty to a felony information charging him with possessing methamphetamine with intent to distribute. In entering the guilty plea, Martinez admitted that on May 16, 2016, he possessed approximately 49 grams of methamphetamine when Sierra County Sheriff’s Office deputies initiated a traffic stop on his vehicle. Martinez also acknowledged that he intended to distribute the methamphetamine to other people.
This case was investigated by the Las Cruces office of Homeland Security Investigations, the New Mexico State Police and the Sierra County Sheriff’s Office. Assistant U.S. Attorney Matthew Beck of the U.S. Attorney’s Las Cruces Branch Office prosecuted the case.
Seymour Man Sentenced to Federal Prison on Child Pornography ChargeRead the Press Release
Gregory J. Haanstad, United States Attorney for the Eastern District of Wisconsin, announced that on April 17, 2017, Travis M. Kamps (age: 25) of Seymour, Wisconsin, was sentenced by Chief District Judge William C. Griesbach to 5 years in federal prison for receipt of child pornography in violation of Title 18 United States Code Section 2252A(a)(2). Upon his release the defendant will be on federal supervised release for 5 years and will have to register as a sex offender in the jurisdiction in which he resides.
Kamps used his cellular telephone and social media platforms to exchange texts, instant messages, and sexually explicit images with several underage girls throughout the United States. Ultimately, he pled guilty and was convicted of requesting and receiving five sexually explicit videos from a 16-year-old victim located in Illinois.
In pronouncing sentence, Chief Judge Griesbach expressed skepticism that Kamps, and others who have committed similar crimes, would have ever have engaged in such highly sexualized conversations or requested sexually explicit photos and videos face-to-face with their victims, but rather relied on the anonymity that the internet and social media provide. He further pointed to the need to send a strong message of deterrence to Kamps and others, to discourage similar behavior in the future.
The case was investigated by the Seymour Police Department, the Wisconsin Internet Crimes Against Children (ICAC) Task Force, and the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Daniel R. Humble.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006, by the U.S. Department of Justice. Led by U.S. Attorneys’ Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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SCM True Air Technologies, of Ohio and Kentucky, and Its Former Company President - Guilty of Delivering Misbranded Medical Devices from Unregistered Facilities to A Georgia V.A. Medical Center and Obstructing an FDA Investigation into Their ConductRead the Press Release
Defective and unusable bariatric beds were produced in unregistered facilities by the company
Company agrees to pay full restitution and a fine of $500,000
LOUISVILLE, Ky. – United States Attorney John E. Kuhn, Jr. today announced the guilty pleas to a criminal information made on April 17, 2017 by SCM True Air Technologies, Inc. and the former company president John N. Keesaer, in United States District Court before Magistrate Judge Dave Whalin. SCM True Air pled guilty to one count of operating an establishment that manufactured medical devices without having properly registered that establishment as required by law. Keesaer pled guilty to one count of obstruction of an FDA investigation and one count of introducing misbranded medical devices into commerce.
“This company and its former president sold defective and unusable beds to the VA,” stated U.S. Attorney John Kuhn. “Our veterans deserve far better consideration and treatment. These defendants will be held accountable for breaking the law then attempting to cover that up.”
"Defrauding VA by providing unregistered and substandard bariatric beds for use by our nation's veterans is inexcusable," said Kim Lampkins, Special Agent in Charge, U.S. Department of Veterans Affairs, Office of Inspector General, Mid-Atlantic Field Office. “This investigation demonstrates that the VA OIG, working with our colleagues in law enforcement, will aggressively pursue those who place our nation’s veterans at risk for their own private gain.”
“FDA’s ability to protect the public health relies on regulated industries fulfilling their responsibilities to comply with FDA requirements,” said Mark S. McCormack, Special Agent in Charge, U.S. FDA Office of Criminal Investigations’ Metro Washington Office. “Those who attempt to circumvent FDA’s regulatory process put consumers’ health at risk and this will not be tolerated.”
According to separate plea agreements, beginning at least as early as 2010 and continuing until September 2012, John N. Keesaer, acting as president of SCM True Air, delivered bariatric hospital beds, which are Class II medical devices, that were misbranded due to the fact that they were manufactured in an establishment that was not registered with the FDA as required by law. Further, on January 29, 2014, Keesaer corruptly obstructed an FDA compliance inspection regarding SCM True Air’s production methods including facilities that produced bariatric beds.
Specifically, while Keesaer was President of SCM True Air, the company’s manufacturing process for bariatric hospital beds involved establishments in both Roseville, Ohio, and Louisville, Kentucky, that the company had not properly registered with the FDA to produce Class II medical devices, despite the fact that Keesaer and the company had been previously advised on repeated occasions that such registration was required by law.
Starting in at least 2010, SCM True Air produced medical devices such as bariatric beds at its Louisville and Roseville establishments without properly registering the establishments with the FDA for over two and a half years. As a result of the fact that the bariatric beds were manufactured at establishments that were not duly registered with the FDA, those beds were misbranded in violation of federal law.
At Keesaer’s direction and under his supervision, SCM True Air then sold and delivered misbranded bariatric beds from its Louisville and Roseville establishments to purchasers throughout the
States. Keesaer personally participated in the delivery of misbranded bariatric beds from SCM True Air to various facilities.
In 2012, SCM True Air entered into a contract with the Department of Veterans Affairs to deliver 48 bariatric beds, mattresses and accessories to the Trinka Davis Veterans Village in Carrollton, Georgia, a unit of the Atlanta V.A. Medical Center. SCM True Air was paid $211,691.62 for the beds despite the fact that, unknown at the time to the Department of Veterans Affairs, those beds were produced by SCM True Air both using parts from the Louisville establishment and further manufactured in the Roseville establishment.
During the process of manufacturing the 48 bariatric beds for the contract with the Department of Veterans Affairs, Keesaer stated to others that the SCM True Air establishments were registered with the FDA when, as he then in fact knew, they were not. Further, upon delivery to the V.A. medical center in September 2012, the bariatric beds were substantially defective, as many of the beds had caulking and welding issues, rusting parts and dirt affixed to them. As a result of these defects, the beds were entirely unusable by the patients at the Veterans Village.
The FDA subsequently initiated a formal compliance investigation regarding SCM True Air’s alleged adulteration and misbranding of bariatric beds. During that investigation, Keesaer, acting as President of the company, intentionally obstructed the compliance investigation by making a materially false written statement in the course of that investigation.
If convicted at trial, Keesaer would face a combined maximum term of six years in prison, a maximum fine of the greater of $350,000 or twice the gross gain to the defendant or loss to victims resulting from his offense, and a four-year term of supervised release. If the company were convicted at trial it would face a maximum fine of the greater of $500,000 or twice the gross gain to the company or loss to victims resulting from its offense. Also, if convicted at trial, both Keesaer and the company would be obligated to pay restitution to any victims of their offenses.
According to the terms of its plea agreement, SCM True Air has agreed to pay restitution in the amount of $211,691.62 and a fine of $500,000. According to the terms of his plea agreement, Keesaer is jointly liable for the same amount of restitution, and the United States has agreed to recommend a sentence of probation and a fine at the time of his sentencing hearing.
Sentencing is scheduled before Senior District Judge Thomas B. Russell on July 17, 2017, in Louisville.
Assistant United States Attorneys Stephanie M. Zimdahl and H. Joseph Pinto III are prosecuting this case. The United States Food and Drug Administration Office of Criminal Investigations and Department of Veterans Affairs, Office of Inspector General, Mid-Atlantic Field Office, are investigating.
Runnells Couple Sentenced for Bankruptcy OffenseRead the Press Release
DES MOINES, IA – On April 18, 2017, Elizabeth Ann Thayer, age 61, of Runnells, Iowa, was sentenced by United States District Judge Stephanie M. Rose for concealing assets belonging to her bankruptcy estate, announced United States Attorney Kevin E. VanderSchel. She was sentenced to 32 months of probation, ordered to complete community service, and to pay $100 to the Crime Victims’ Fund.
On December 14, 2016, Judge Rose sentenced Elizabeth’s husband, George Bradley Thayer, age 66, for the same offense. He was ordered to serve 36 months of probation, to include one year in home confinement, and to pay $100 to the Crime Victims’ Fund.
On January 27, 2011, George and Elizabeth Thayer filed a joint individual Chapter 7 bankruptcy with the United States Bankruptcy Court for the Southern District of Iowa. On December 10, 2010, the Thayers conveyed 20 acres of farm property to a relative. In their bankruptcy filings, they knowingly failed to disclose their continuing interest in the land and knowingly failed to disclose the transfer of the property to a relative, despite their obligations to make both disclosures in the filings. On March 21, 2011, each falsely asserted to the bankruptcy trustee under oath that there had been no transfers of property to a relative within the last two years.
This case was investigated by the Office of the United States Trustee. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
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Learn more about this release by calling Rachel J. Scherle at 515-473-9300, or by emailing her at [email protected].
Prolific Possessor and Distribtor of Child Pornography SentencedRead 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 Alexander Burton Blake, 26, of Cheektowaga, NY, who was convicted of distribution and possession of child pornography, was sentenced to 40 months imprisonment with 10 years of supervised release. He was also ordered to pay restitution to his victims in the amount of $48,000 by Chief United States District Judge Judge Frank P. Geraci, Jr.
Assistant U.S. Attorney Aaron J. Mango, who is handling the case, stated that the defendant was utilizing a peer-to-peer network to distribute child pornography. Several items of computer equipment seized from the defendant’s residence revealed that the equipment contained approximately 70,000 images of child pornography and 650 videos of child pornography.
The sentencing is the result of an investigation by Special Agents of the Federal Bureau of Investigation under the direction of Adam Cohen, Special Agent-in-Charge, along with the City of Buffalo Police Department, under the direction of Commissioner Daniel Derenda, and the Cheektowaga Police Department, under the direction of Chief David Zack.
Pittsburgh Doctor and His Employee Charged with Illegal Rx Drug Distribution, Health Care FraudRead the Press Release
PITTSBUGH - Two Pittsburgh residents have been indicted by a federal grand jury on charges of distribution of Oxycodone, a Schedule II controlled substance, and Amphetamine, a Schedule II controlled substance, outside the usual course of professional practice, and health care fraud, Acting United States Attorney Soo C. Song announced today.
The 15-count indictment named Brent E. Clark, 55, a family care physician who practices in Pittsburgh, and Carl T. Wilson, age 49, an office employee of Clark, as the defendants.
According to the indictment, from February 26, 2015 through March 27, 2017, Clark distributed Oxycodone, a Schedule II controlled substance, on 13 occasions, and Amphetamine, a Schedule II controlled substance, on three occasions, outside the usual course of professional practice. The indictment also alleges that on March 27, 2017, Wilson knowingly, intentionally, and unlawfully possessed with intent to distribute and distributed oxycodone, a Schedule II controlled substance. The indictment further alleges that from February 2015 to February 2017, Clark knowingly and willfully executed, and attempted to execute, the above-described scheme to defraud and to obtain, by means of materially false and fraudulent pretenses, representations, and promises, money and property owned by and under the custody and control of United Health Care and Medicare, health care benefit programs, in connection with the payment for health care benefits, items and services.
For Brent E. Clark, the law provides for a maximum total sentence on all counts of incarceration of up to 270 months, a fine of $13,250,000, or both. For Carl T. Wilson, the law provides for a maximum total sentence of 20 years, a fine of $1,000,000, 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 Cindy K. Chung is prosecuting this case on behalf of the government.
The Drug Enforcement Administration, the Department of Health and Human Services, Office of Inspector General, and the Federal Bureau of Investigation conducted the investigation that led to the prosecution of Brent E. Clark and Carl T. Wilson.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Parker CPA Pleads Guilty to Wire Fraud and Aiding and Assisting in the Preparation of False Tax ReturnsRead the Press Release
DENVER – Don R. Iley of Parker, Colorado, pled guilty today before U.S. District Court Judge Christine M. Arguello to wire fraud and aiding and assisting in the preparation of false tax returns, the United States Attorney’s Office and IRS-Criminal Investigation announced. Iley was indicted by a federal grand jury in Denver on August 24, 2016, and is scheduled to be sentenced by Judge Arguello on July 13, 2017 at 3:00 p.m.
According to the indictment and plea agreement, from January 2009 through December 2015, Iley was the owner and operator of Iley and Associates (I&A), an accounting and tax preparation firm which provided services to more than 140 businesses in Colorado. For some of I&A clients, payroll accounting and payroll tax services were provided. The payroll tax services included the preparation of Forms 941, Employer’s Quarterly Federal Tax Returns, and then withdrawing and paying the required payroll taxes to the IRS on behalf of the clients.
Iley caused his staff to collect the necessary information from payroll clients to prepare Quarterly Federal Tax Returns. Iley also caused his staff to prepare an “ACH Deduction Report”, which identified the payroll client’s “Total Federal Payroll Tax liability” for each pay period. The ACH Deduction report also identified other amounts to be withdrawn from each payroll client’s bank account, such as the federal and state unemployment tax. The funds withdrawn from the client’s bank accounts were transferred to a bank account controlled solely by Iley.
Iley would then cause his employees to send the clients a cover letter falsely representing the Form 941 included in the letter was filed with the IRS and that Iley had paid or would pay the taxes. Instead, Iley retained the payroll tax monies from his payroll clients for whom he was responsible for paying such taxes. To facilitate his scheme, Iley prepared and signed on behalf of Iley & Associates false Form 941 tax returns claiming the payroll tax client had no payroll taxes due and owing. Iley then mailed the false tax returns to the IRS.
Iley kept the money he received that was intended for payroll taxes and used it for his own purposes. Iley used some of the money to, among other things, make $900,000 in accelerated principal payments for Iley’s home, pay for the design, construction, landscaping and furnishing of Iley’s residence, and make investments in businesses and retirement accounts. By Iley’s own estimate, he stole at least $11 million dollars during this time frame.
Wire fraud carries a penalty of not more than 20 years in federal prison, and a fine of up to $250,000 or twice the amount of gain or loss, whichever is greater. Aiding and assisting in the preparation of false tax returns carries a penalty of not more than 3 years in federal prison, and a fine of up to $250,000 or twice the amount of the gain or loss, whichever is greater.
This case is being investigated by the Internal Revenue Service – Criminal Investigation. The case is being prosecuted by Assistant United States Attorney J. Chris Larson.
Oregon Woman Sentenced in East Texas Child Exploitation ConspiracyRead the Press Release
TYLER, Texas — A 35-year-old Medford, Oregon woman has been sentenced to federal prison for child exploitation violations in the Eastern District of Texas, announced Acting U.S. Attorney Brit Featherston today.
Crystal Beam pleaded guilty on Nov. 14, 2016, to conspiracy to sexually exploit children and was sentenced to 216 months in federal prison today by U.S. District Judge Ron Clark. Beam will be required to register as a sex offender upon her release from federal prison.
According to information presented in court, between November 2014 and January 2015, Beam conspired and agreed with Brian Casper, 27, of Tyler, Texas to use minor children to engage in sexually explicit conduct for the purpose of producing visual depictions and transmitting live visual depictions of such conduct.
Casper also conspired and agreed with Taylor Keeth, 22, of Indianola, Iowa, and Lacy Brooks, 31, of Searcy, Arkansas, to use minor children to engage in sexually explicit conduct for the purpose of producing visual depictions and transmitting live visual depictions of such conduct.
Casper pleaded guilty on Nov. 16, 2016, to conspiracy to sexually exploit children. Keeth pleaded guilty on Dec. 7, 2016, to conspiracy to sexually exploit children. Brooks pleaded guilty on Jan. 10, 2017 in the Eastern District of Arkansas, to production of child pornography and distribution of child pornography.
“He who harms the child, shall have a millstone tied upon his neck and he shall be cast into the deepest part of the sea,” said Acting U.S. Attorney Brit Featherston. “Although we cannot cast anyone into the sea, it is, and shall remain the highest priority that those who harm a child shall be swiftly brought to justice and punishment shall be sought.”
On Apr. 10, 2017, Casper and Keeth were sentenced by Judge Clark. Casper was sentenced to 336 months in federal prison, and Keeth was sentenced to 282 months in federal prison. Brooks is awaiting sentencing.
This case was prosecuted as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
“These cases are heart wrenching for all involved, the child advocates, the families, the investigators, the prosecutors and the courts,” said Acting U.S. Attorney Featherston. “I applaud their resilience and fortitude in bringing these predators to justice.”
This case was investigated by the Federal Bureau of Investigation, Tyler Police Department, Port of Galveston Police Department, White County (Arkansas) Sheriff's Office, Indianola (Iowa) Police Department, and the Medford (Oregon) Police Department. This case is being prosecuted by Assistant U.S. Attorney Nathaniel C. Kummerfeld, in cooperation with Assistant U.S. Attorneys Erin O'Leary and Kristin Bryant of the Eastern District of Arkansas.
Orange County, Texas Man Sentenced for Drug TraffickingRead the Press Release
BEAUMONT, Texas – A 37-year-old Orange, Texas man has been sentenced to prison for federal drug trafficking violations in the Eastern District of Texas, announced Acting U.S. Attorney Brit Featherston today.
Kenneth Martin, Jr., was found guilty by a jury on July 13, 2016 of conspiracy to possess with intent to distribute methamphetamine and was sentenced to 115 months in federal prison today by U.S. District Judge Ron Clark.
According to information presented in court, from September 2015 to February 2016, Martin conspired with others to distribute methamphetamine in and around the Orange County, Texas area. Evidence presented at trial indicated that Kenneth Martin, Jr., who was traveling with his cousin and co-defendant, Brandon Martin, were stopped by Orange County Sheriff's deputies for traffic violations. Brandon Martin, who was the driver of the vehicle, gave officers verbal consent to search the vehicle and officers located a magnetic key box under the left front wheel well. This is the same location from where officers observed Brandon Martin a few days earlier, retrieve suspected methamphetamine. Kenneth Martin, Jr. was searched and found to have a small amount of methamphetamine in his pocket and both Brandon and Kenneth Martin were arrested and taken to the Orange County Jail. Once at the jail, Kenneth Martin repeatedly advised officers that the substance found in the magnetic box was all his and Brandon had nothing to do with it.
This case is the result of an extensive joint investigation by the Organized Crime Drug Enforcement Task Force (OCDETF). The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
This case was investigated by the Drug Enforcement Administration, the Orange County Sheriff’s Office and the Orange Police Department and prosecuted by Assistant U.S. Attorney Michelle S. Englade.
Ohio Man Sentenced to 10 Years in Federal Prison for Travel with Intent to Engage in Illegal Sexual ConductRead the Press Release
Baltimore, Maryland – U.S. District Judge Ellen L. Hollander sentenced Michael L. Fischer, age 42, of Toledo, Ohio, today to 10 years in federal prison, followed by 20 years of supervised release, for travel with intent to engage in illicit sexual conduct. Fisher traveled from Ohio to Maryland to engage in sexual activity with a fifteen-year-old girl.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Gordon B. Johnson of the Federal Bureau of Investigation - Baltimore; Special Agent in Charge Stephen D. Anthony of the Federal Bureau of Investigation – Cleveland, Ohio; Commissioner Kevin Davis of the Baltimore Police Department; and Colonel William M. Pallozzi, Superintendent of the Maryland State Police.
According to his plea agreement, in the summer of 2014, Fischer and the victim met online and communicated using chat rooms, social media, and telephone during the summer and fall of 2014. The victim told Fischer that she was 15 years old from their earliest communications, and prior to Fischer meeting the victim in person. In August and early September 2014, Fischer travelled from Ohio to Maryland and engaged in sexual activity with the girl. On September 19, 2014, Fisher and his wife travelled from Ohio to Maryland and picked the girl up near her home in the early morning of September 20, 2014. Fischer and his wife then transported the girl to Fischer’s home in Toledo. At the time, Fisher’s wife was not aware that Fisher had been engaging in sexual conduct with the victim. Between September 20 and 26, 2014, Fischer engaged in sexual conduct with the victim in Ohio.
On September 23, 2014, the Fischers were contacted by law enforcement regarding the victim’s whereabouts. According to his plea agreement, prior to meeting with law enforcement, the Fischers dropped the victim off at a store in Toledo. Fischer lied to law enforcement officers that he did not know where the victim was and suggested to law enforcement that he believed she may be in Florida. After the meeting, Fischer transported the victim from Ohio to Brighton, Michigan, and left the victim with one of his relatives. She was recovered by law enforcement officers two days later.
The case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the “resources” tab on the left of the page.
The case was investigated by the FBI-led Maryland Child Exploitation Task Force (MCETF), created in 2010 to combat child prostitution, with members from10 state and federal law enforcement agencies. Task Force coordinates with the National Center for Missing and Exploited Children and the Maryland State Police Child Recovery Unit to identify missing children.
United States Attorney Rod J. Rosenstein commended the FBI Baltimore, Cleveland, Ohio and Detroit, Michigan Field Offices, the Baltimore Police Department, Maryland State Police, and the Toledo Child Exploitation Task Force for their work in the investigation, and thanked the Brighton, Michigan Police Department, the Livonia, Michigan Police Department and the Michigan State Police for their assistance. Mr. Rosenstein thanked Assistant U.S. Attorneys Zachary A. Myers and Ayn B. Ducao, who prosecuted the case.
Northern California Real Estate Investor Convicted of Rigging Bids at Public Foreclosure AuctionsRead the Press Release
A federal jury convicted real estate investor Glenn Guillory for his role in a conspiracy to rig bids at public foreclosure auctions held in Contra Costa County, California, the Department of Justice announced today.
After a week-long trial before the Honorable Chief Judge Phyllis J. Hamilton in Oakland, California, the jury convicted Guillory yesterday of conspiring to rig bids at foreclosure auctions in a conspiracy that operated from as early as June 2008 until about January 2011. Guillory was charged in an indictment returned by a federal grand jury in the Northern District of California on Dec. 3, 2014.
The evidence at trial showed that Guillory and his co-conspirators agreed not to compete for real estate sold at foreclosure auctions in Contra Costa County. The conspirators negotiated payoffs for agreeing not to compete and held second, private auctions known as “rounds” to determine the amounts of the payoffs for the individuals who had participated in the bid suppression.
Including Guillory’s conviction, 65 individuals have either pleaded guilty or been convicted after trial as a result of the department’s ongoing antitrust investigations into bid-rigging at public foreclosure auctions in Northern California (Alameda, Contra Costa, San Francisco and San Mateo counties). Indictments are pending against several other real estate investors who participated in the conspiracy.
The investigation is being conducted by the Antitrust Division’s San Francisco Office and the FBI’s San Francisco Office. Anyone with information concerning bid rigging or fraud related to real-estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at 415-934-5300 or call the FBI tip line at 415-553-7400.
New York Man Indicted on Sex Trafficking ChargesRead the Press Release
SCRANTON- The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Derrel Wilson, age 32, of Mount Vernon, New York, was indicted on April 11, 2017, by a federal grand jury on sex trafficking charges.
The indictment was unsealed on April 14, 2017, and Wilson’s initial appearance was held April 18, 2017, before United States District Judge Malachy E. Mannion.
According to United States Attorney Bruce D. Brandler, the indictment alleges that Wilson trafficked three women as prostitutes through force, threat, and coercion and that Wilson provided his victims with controlled substances, including heroin. The indictment further charges Wilson with transporting women in interstate commerce to engage in prostitution.
The case was investigated by the U.S. Federal Bureau of Investigation, the Monroe County Detectives Office, Stroud Regional Police Department, and the Monroe County District Attorney’s Office. Assistant U.S. Attorney Sean A. Camoni is prosecuting the case.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
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 for this offense is a life term 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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New York Doctor Pleads Guilty in Connection with Test-Referral Scheme with New Jersey Clinical LabRead the Press Release
NEWARK, N.J. – An internal medicine doctor practicing in Staten Island, New York, today admitted taking bribes in connection with a long-running and elaborate test referral scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president and numerous associates, Acting U.S. Attorney William E. Fitzpatrick announced.
Ahmed El Soury, 44, of Monmouth Junction, New Jersey, pleaded guilty to Count One of an indictment charging him with conspiracy to violate the Anti-Kickback Statute, the Federal Travel Act, and the honest services wire fraud statute. El Soury pleaded guilty before U.S. District Judge Stanley R. Chesler in Newark federal court.
According to documents filed in this case and statements made in court:
El Soury admitted accepting cash bribes in return for referring patient blood specimens to BLS. From March 2011 through April 2013, El Soury received bribes totaling more than $66,000 from BLS employees and associates. El Soury’s referrals generated approximately $650,000 in lab business for BLS.
The investigation has thus far resulted in 44 convictions – 30 of them doctors – in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. It is believed to be the largest number of medical professionals ever prosecuted in a bribery case.
The investigation has to date recovered more than $12 million through forfeiture. On June 28, 2016, BLS, which is no longer operational, pleaded guilty and was required to forfeit all of its assets.
The conspiracy charge to which El Soury pleaded guilty is punishable by a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. El Soury’s sentencing is scheduled for July 19, 2017.
El Soury is one of five physicians who have been indicted in connection with the BLS bribery scheme. Brett Ostrager – who was indicted Aug. 11, 2015 and pleaded guilty on Dec. 22, 2015 – was sentenced on June 8, 2016 to 37 months in prison. Salvatore Conte was indicted on Jan. 10, 2017, pleaded guilty on Feb. 28, 2017, and will be sentenced June 6, 2017. Bernard Greenspan was indicted on March 14, 2016, convicted at trial before U.S. District Judge William H. Walls on March 6, 2017, and will be sentenced on June 20, 2017. Thomas Savino was indicted on Dec. 20, 2016 and is pending trial before Judge Chesler.
Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark; inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge James V. Buthorn; IRS–Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the ongoing investigation.
The government is represented by Assistant U.S. Attorneys Joseph N. Minish, Danielle Alfonzo Walsman, and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Assistant U.S. Attorney Barbara Ward, Acting Chief of the office’s Asset Forfeiture and Money Laundering Unit.
The New Jersey U.S. Attorney’s Office reorganized its health care fraud practice in 2010 and created a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since that time, the office has recovered more than $1.32 billion in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.
Defense counsel: Albert Dayan Esq., Kew Gardens, New York
Miami-Dade County Resident Pleads Guilty to Committing a Spree of Commercial Armed RobberiesRead the Press Release
A Miami-Dade County resident pled guilty in federal court yesterday to committing a spree of commercial armed robberies between April 28, 2016 and May 3, 2016.
Benjamin G. Greenberg, Acting U.S. Attorney for the Southern District of Florida, Peter Forcelli, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Division, Al Rolle, Chief, Homestead Police Department, and Juan P. Perez, Director, Miami-Dade Police Department (MDPD), made the announcement.
Humberto Herrera, 43, of Homestead, pled guilty before United States District Judge Kathleen M. Williams in Miami, Florida, to four counts of Hobbs Act robbery, and one count of possessing, using, and brandishing a firearm in furtherance of a crime of violence. Herrera faces a statutory maximum sentence of 20 years’ imprisonment for each robbery and a minimum sentence of seven years’ imprisonment as to the firearm count. Herrera is scheduled to be sentenced by Judge Williams on July 14, 2017 at 10:00 a.m.
According to the superseding indictment, Herrera committed armed robberies of a Little Caesar’s restaurant, Advance Auto Parts, RaceTrac gas station, and Kohl’s Department Store, in Miami-Dade County, on April 28, April 29, May 2, and May 3, 2016, respectively. As detailed in the agreed upon factual proffer, on each of these dates, Herrera entered the business, brandished a firearm, and threatened a store employee. From Little Caesar’s, Advance Auto Parts, and RaceTrac, Herrera took United States currency; whereas, from Kohl’s, Herrera took approximately $33,000 worth of jewelry.
Mr. Greenberg commended the investigative efforts of ATF, Homestead Police Department and MDPD. This case is being prosecuted by Assistant US Attorneys Jonathan K. Osborne and J. Mackenzie Duane.
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.
Men Indicted for Lying and Obstructing Justice in ISIL Terrorism CaseRead the Press Release
ALEXANDRIA, Va. – Owners of a Fairfax gaming center were indicted by a federal grand jury today on charges of conspiracy to obstruct justice and make false statements involving international terrorism, obstruction of justice, and making false statements involving international terrorism.
According to allegations in the indictment, Michael Queen, 28, of Woodbridge, and Soufian Amri, 32, of Falls Church, lied to FBI agents to prevent them from learning about and investigating their friend Haris Qamar’s support of the Islamic State of Iraq and the Levant (ISIL). Queen and Amri knew that Qamar had attempted to travel overseas to join ISIL in 2014, yet they lied to and misled the FBI by saying that the only person they knew who might travel to join ISIL was a “tall, thin, Indian” individual. Queen later told Qamar that Queen and Amri gave the FBI the name of a Hindu individual as someone who might support ISIL. Queen told Qamar, “I’m never going to throw a Muslim underneath the bus to try to do the right thing.”
Qamar was sentenced to 8 1/2 years in prison on February 17 for attempting to provide material support to ISIL.
Queen and Amri each face a maximum penalty of 20 years in prison if convicted. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Andrew W. Vale, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the indictment was returned. Assistant U.S. Attorneys Gordon D. Kromberg and Colleen E. Garcia are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:17-cr-50.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
Member of ATM Skimming Conspiracy Pleads Guilty for Targeting Multiple New Jersey Bank LocationsRead the Press Release
A member of a scheme that used secret card-reading devices and pinhole cameras on PNC and Bank of America ATMs to steal at least $428,581 pleaded guilty today in Newark federal court.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; Acting U.S. Attorney William E. Fitzpatrick of the District of New Jersey; and Acting Special Agent in Charge Brian A. Michael of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Newark, New Jersey, Office made the announcement.
Joel Abel Garcia, 35, a U.S. citizen from Bronx, New York, pleaded guilty before U.S. District Judge Esther Salas of the District of New Jersey to one count of conspiracy to commit bank fraud. Garcia is the third of 13 defendants charged in this matter to plead guilty. Victor A. Hanganu, 35, a Romanian citizen residing in Bayside, New York, pleaded guilty on April 10, 2017, to an information charging him with one count of conspiracy to commit bank fraud. Sentencing for Garcia and Hanganu is set for Aug. 2, 2017, and July 31, 2017, respectively.
According to admissions made in connection with the pleas, Garcia, Hanganu and others sought to defraud financial institutions and their customers by illegally obtaining customer account information, including account numbers and personal identification numbers. Garcia and Hanganu both admitted that between March 2015 and July 2016, they used counterfeit ATM cards and stolen customer information to withdraw cash from compromised bank accounts at ATMs in New Jersey. As part of his plea, Hanganu also admitted that as part of the scheme, he installed “skimming” devices on the ATMs, including pinhole cameras that recorded password entries and card-reading devices capable of recording customer information encoded on magnetic strips.
Garcia, Hanganu and others used more than 10 ATM cards to conduct fraudulent cash withdrawals in New Jersey, causing losses of $428,581. Of that sum, $132,805 was personally attributable to Garcia.
In addition to Garcia and Hunganu, Radu Marin, 36, a Romanian citizen residing in Glendale, New York, pleaded guilty on March 29, 2017, to an information charging him with one count of conspiracy to commit bank fraud.
The ICE-HSI’s Newark, New Jersey, Division; U.S. Secret Service’s Boston Field Office; Longmeadow, Massachusetts, Police Department; Cambridge, Massachusetts, Police Department; and Medford, Massachusetts, Police Department investigated the case with assistance from Bank of America Security and Fraud Section and PNC Bank Security Division. The Middlesex County, Massachusetts, District Attorney’s Office; U.S. Attorney’s Office of the Eastern District of New York and U.S. Attorney’s Office of the District of Massachusetts Springfield Division assisted in the investigation and prosecution. Trial Attorney Marianne Shelvey of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorney Kelly Graves of the District of New Jersey are prosecuting the case.
Member of ATM Skimming Conspiracy Targeting Multiple New Jersey Bank Locations Pleads GuiltyRead the Press Release
NEWARK, N.J. – A member of a scheme that used secret card-reading devices and pinhole cameras on PNC and Bank of America ATMs to steal at least $428,581 pleaded guilty today in Newark federal court.
Acting U.S. Attorney William E. Fitzpatrick of the District of New Jersey; Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; and Acting Special Agent in Charge Brian A. Michael of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations Newark Division made the announcement.
Joel Abel Garcia, 35, a U.S. citizen from Bronx, New York, pleaded guilty before U.S. District Judge Esther Salas to an information charging him with one count of conspiracy to commit bank fraud.
Garcia is the third of 13 defendants charged in this matter to plead guilty. Victor A. Hanganu, 35, a Romanian citizen residing in Bayside, New York, pleaded guilty on April 10, 2017 to an information charging him with one count of conspiracy to commit bank fraud.
According to documents filed in this case and statements made in court:
Garcia, Hanganu, and others sought to defraud financial institutions and their customers by illegally obtaining customer account information, including account numbers and personal identification numbers. Garcia and Hanganu both admitted that between March 2015 and July 2016, they used counterfeit ATM cards and stolen customer information to withdraw cash from compromised bank accounts at ATMs in New Jersey. Hanganu also admitted that as part of the scheme, he installed “skimming” devices on the ATMs, including pinhole cameras that recorded password entries and card-reading devices capable of recording customer information encoded on magnetic strips.
Garcia, Hanganu, and others used more than 10 ATM cards to conduct fraudulent cash withdrawals in New Jersey, causing losses of $428,581, $132,805 of which was personally attributable to Garcia.
The conspiracy to commit bank fraud charge carries a maximum potential penalty of 30 years in prison and a $1 million fine. Sentencing for Garcia and Hanganu is set for Aug. 2, 2017 and July 31, 2017, respectively.
In addition to Garcia and Hunganu, Radu Marin, 36, a Romanian citizen residing in Glendale, New York, pleaded guilty on March 29, 2017, to an information charging him with one count of conspiracy to commit bank fraud.
The U.S. Immigration and Customs Enforcement’s Homeland Security Investigation’s Newark, New Jersey, Division; U.S. Secret Service’s Boston Field Office; Longmeadow, Massachusetts, Police Department; Cambridge, Massachusetts, Police Department; and Medford, Massachusetts, Police Department investigated the case with assistance from Bank of America Security and Fraud Section and PNC Bank Security Division. The Middlesex County, Massachusetts, District Attorney’s Office; U.S. Attorney’s Office of the Eastern District of New York and U.S. Attorney’s Office of the District of Massachusetts Springfield Division assisted in the investigation and prosecution.
The government is represented by Assistant U.S. Attorney Kelly Graves of the U.S. Attorney’s Office Criminal Division in Newark and Trial Attorney Marianne Shelvey of the Justice Department’s Criminal Division Organized Crime and Gang Section.
Defense counsel:
Garcia: Lorraine Gauli-Rufo Esq., Verona, New Jersey
Hanganu: Michael N. Pedicini Esq., Chatham, New Jersey
Maryland man convicted for distributing heroinRead the Press Release
UPDATE
The guilty plea entered by defendant Kelvin Johnson was rejected by Chief U.S. District Judge Gina M. Groh on August 7, 2017.
MARTINSBURG, WEST VIRGINIA – Kelvin Johnson, of Baltimore, Maryland, was convicted today in federal court distributing heroin, Acting United States Attorney Betsy Steinfeld Jividen, announced.
Johnson, age 24, pled guilty to one count of “Distribution of Heroin.” Kelvin admitted to distributing heroin in Berkeley County on May 28, 2016.
Johnson faces up to twenty years in prison and a fine of up to $1,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Anna Z. Krasinski is prosecuting the case on behalf of the government. The Eastern Panhandle Drug and Violent Crime Task Force, a HIDTA-funded initiative, investigated.
U.S. Magistrate Judge Robert W. Trumble presided.
Man Charged with Federal Tax Return FraudRead the Press Release
TALLAHASSEE, FLORIDA – Torry Williams, 23, of Tampa, was arraigned yesterday in the U.S. District Court in Tallahassee after a federal grand jury returned an indictment charging him with theft of government funds and aggravated identity theft. The indictment was announced by Christopher P. Canova, United States Attorney for the Northern District of Florida.
The indictment alleges that, between November 2012 and June 2013, Williams unlawfully used the personal identifying information of multiple individuals to obtain approximately $149,847 in funds stolen from the Internal Revenue Service.
The trial is scheduled for June 12 at 8:15 a.m. at the United States Courthouse in Tallahassee.
This case resulted from an investigation by the Internal Revenue Service-Criminal Investigation. Assistant United States Attorney Michael J. Harwin is prosecuting the case.
An indictment is merely an allegation by a grand jury that a defendant has committed a violation of federal criminal law and is not evidence of guilt. All defendants are presumed innocent and entitled to a fair trial, during which it will be the government’s burden to prove guilt beyond a reasonable doubt at trial.
The United States Attorney’s Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
For more information, contact: Amy Alexander, Public Information OfficerLuzerne County Woman Pleads Guilty to Theft of Postal FundsRead the Press Release
SCRANTON – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a Luzerne County woman pleaded guilty on April 17, 2017, before United States District Judge Robert D. Mariani to misappropriating postal funds from the U.S. Post Office in Dallas, Pennsylvania.
According to U.S. Attorney Bruce D. Brandler, Carol Sosik, age 55, of Shavertown, Luzerne County, admitted to embezzling approximately $4,600 from the Dallas Post Office between June 2014 and May 2016. Sosik was employed at the Dallas Post Office as a distribution window clerk, with responsibility for sales of postage stamps.
Sosik will appear for sentencing before Judge Mariani in Scranton on a date which has not yet been scheduled.
This matter was investigated by the United States Postal Service, Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorney Robert J. O’Hara.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is 10 years 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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Leader of Cocaine Trafficking Conspiracy SentencedRead the Press Release
CINCINNATI – Raul Barocio, 47, of Cincinnati, was sentenced in U.S. District Court yesterday to 63 months in prison for his role as a source of supply in a cocaine trafficking ring. Barocio pleaded guilty in April 2016 to one count of conspiracy to possess with intent to distribute cocaine.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration (DEA), and other members of the DEA Task Force announced the sentences handed down by United States District Court Judge Susan Dlott.
Seven co-defendants, all Cincinnati-area residents, have also been sentenced in the cocaine conspiracy. They include:
Carmella V. Smith, who was sentenced to 87 months in prison;
Daymond Williams, who was sentenced to 108 months in prison;
Derrick Thorne, who was sentenced to 60 months in prison;
Gregory Jordan, who was sentenced to 64 months in prison;
Deantre B. Pruett, who was sentenced to 62 months in prison;
Wallace Jones, who was sentenced to 60 months in prison; and
Tonya R. Ratliff, who was sentenced to time served and three years of supervised release.
Statements in plea agreements admitted to by the defendants show that they conspired to distribute cocaine in the Cincinnati area from about February 2013 until November 2015. Barocio admitted that his role in the conspiracy was to obtain the cocaine and provide it to Smith who then distributed it, mainly to Williams but also to others. In the conspiracy charged, once Williams obtained cocaine from Smith he then provided it to Thorne, Jordan, Pruett, Jones and Ratliff, who in turn distributed it to street-level users. Williams himself also supplied street-level users.
“This was a significant cocaine trafficking organization in the Cincinnati area,” U.S. Attorney Glassman said. “Even as we work to combat the opioid epidemic in southern Ohio, we must not lose sight of the dangers posed by other drugs. Cocaine remains a menace, and it’s important that we thwart its influence by dismantling sources of supply.”
U.S. Attorney Glassman commended the investigation by DEA task force agents, as well as Assistant United States Attorney Karl P. Kadon who represented the United States in this case.
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Las Vegas Man Sentenced to over Seven Years in Prison for Telemarketing Scam Targeting ElderlyRead the Press Release
LAS VEGAS, Nev. – A Las Vegas man was sentenced today to 88 months in prison for targeting the elderly as part of a telemarking scam that resulted in the loss of nearly $1.2 million, announced Acting U.S. Attorney Steven W. Myhre for the District of Nevada.
Willie James Montgomery, 43, pleaded guilty to one count of conspiracy to commit wire or mail fraud before U.S. District Judge James C. Mahan on Oct. 25, 2016.
According to the plea agreement, from Nov. 24, 2008 to Sept. 5, 2013, Montgomery admitted that he conspired with others to obtain “lead sheets.” A lead sheet identifies persons who had previously entered sweepstakes, lotteries, or other prize-drawing contests, and thus were susceptible to misrepresentations regarding potentially winning a prize, sweepstakes, or lottery. Montgomery and others falsely portrayed themselves as being an official of a lottery or sweepstakes committee or an official of the IRS and told the victims that they had won a prize or lottery, and, in order to receive the prize, they must first send payments in the form of checks, money orders, wire transfers, or cash. Montgomery knew that the victims had not won a prize or lottery and instead kept these advance payments for his own purposes. In order to conceal the scheme, Montgomery and others would direct the victims to send the money to individuals referred to as “runners,” i.e., people who would receive the money wires, cash, checks or money orders and then provide the criminal proceeds to Montgomery and his other co-conspirators. Montgomery further admitted that he and his co-conspirators made calls to at least 66 victims in at least 22 states. Through this scheme, he and his co-conspirators were able to obtain at least 56 MoneyGram wire transfers, totaling approximately $96,983, and 181 Western Union money wires, totaling at least $366,238. In total, the scheme caused losses to victims in the amount of approximately $1.2 million.
The case was investigated by the U.S. Treasury Inspector General for Tax Administration and the United States Postal Inspection Service. The case was prosecuted by Assistant U.S. Attorney Patrick Burns.
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KC-Area Man Charged with Four Bank RobberiesRead the Press Release
KANSAS CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced today that a Kansas City, Mo.-area man has been charged with robbing four banks in Independence, Liberty and Kansas City – three of them in the past two weeks.
Tam Henry Holmes, 56, of the Kansas City metropolitan area, was charged with four counts of bank robbery in a criminal complaint filed in the U.S. District Court in Kansas City, Mo., on Monday, April 17, 2017. Holmes remains in federal custody pending a detention hearing on Thursday, April 20, 2017.
According to an affidavit filed in support of the criminal complaint, Holmes entered Central Bank of Kansas City, 2301 Independence Ave., Kansas City, Mo., at about 1 p.m. on Nov. 16, 2016. Holmes allegedly approached the teller counter and placed a note up against the bullet-proof glass and whispered “700.” The teller told investigators she could not read what was printed on the note, but Holmes continued to whisper “700” and she realized it was a robbery. The teller turned over $450 to Holmes, who then left the bank. The bank reported a loss of $450.
On April 1, 2017, Holmes entered Bank of the West, 850 S. 291 Hwy., Liberty, Mo., at about 10:15 a.m., according to the affidavit. Holmes allegedly held up a spiral notebook containing hand written notations. The teller told investigators that she read the first couple of lines, which she recalled were, “this is a robbery, give me all your large bills.” The teller gathered money from her drawer and gave it to Holmes, the affidavit says, and he left the bank. The bank reported a loss of $8,300.
On April 3, 2017, Holmes entered the Greater Kansas City Public Safety Credit Union, 19341 E. US 40 Hwy., Independence, Mo., at about 2:30 p.m., according to the affidavit. Holmes allegedly walked up to a teller counter and showed the teller two hand-written notes on two yellow Post-it notes. The notes, according to the affidavit, said, “this is a robbery. Don’t pull any dye packs, bail or alarms. I know where you live.” The teller removed cash from her drawer and handed it to Holmes, the affidavit says, and he left the bank. The credit union reported a loss of $12,205.
On April 15, 2017, Holmes entered First Federal Bank of Kansas City, 3500 Noland Rd., Independence, according to the affidavit. Holmes allegedly held up a handwritten note that said, “give me all the money, hurry up, or I will hurt you.” The teller opened her drawer and handed Holmes $100 and $50 bills. She then stared at Holmes, who stated, “hurry up or I’ll do what the note says.” The teller then gave Holmes $20, $10 and $5 bills. Holmes took the money, put it in his pockets and walked out of the bank, the affidavit says. The bank reported a loss of $4,050.
Larson cautioned that the charges contained in this complaint are simply accusations, and not evidence of guilt.
This case is being prosecuted by Assistant U.S. Attorney Bradley K. Kavanaugh. It was investigated by the FBI.
Justice Department Continues to Sue, Prosecute Delinquent EmployersRead the Press Release
Many Americans associate April with “Tax Day” and the annual deadline for filing individual income tax returns. But the end of April is also the first deadline for employers to file quarterly employment tax returns. Those who do not comply with filing requirements or who fail to pay the taxes withheld from their employees’ wages face civil lawsuits or criminal prosecutions as part of the Department of Justice’s ongoing focus to enforce employment tax laws using all tools available.
Employers in the United States are required to collect, account for and pay over to the Internal Revenue Service (IRS) tax withheld from employee wages, including federal income tax and social security and Medicare taxes. Employers also have an independent responsibility to pay their matching share of social security and Medicare taxes.
“Employers who willfully fail to comply with their employment tax obligations are cheating the U.S. Treasury at the expense of taxpayers, such as law-abiding employers and employees, who pay their taxes on time and in full,” said Acting Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division. “The Department is committed to holding employers that willfully fail to pay their employment taxes accountable with, as appropriate, criminal prosecution, bringing these offenders into compliance through civil injunctions, and working with the IRS to collect what is owed.”
“Employment taxes are a critical part of the tax system, generating more than $1 trillion a year in payments to the government, and the IRS works closely with employers and the payroll community to help ensure compliance in this area,” said IRS Commissioner John Koskinen. “We want to help employers avoid problems in the employment tax area. When problems do arise, we use civil enforcement tools and, when appropriate, work closely with the Justice Department in the pursuit of criminal cases. The collection of employment taxes is a priority area for the IRS and helps ensure fairness for employers and taxpayers. Employers who fail to pay or withhold these taxes enjoy an unfair economic advantage over those who comply with the tax laws.”
Willful Failure to Comply with Federal Employment Tax Laws is a Crime
An individual’s willful failure to comply with employment-tax obligations is not simply a civil matter. Employers whose business model is based on a continued failure to pay employment tax, who use withheld employment taxes as a slush fund to pay personal expenses or other creditors, who pay employees in cash to avoid employment tax obligations, or who file false employment tax returns are engaging in criminal conduct and face prosecution, imprisonment, monetary fines and restitution.
Recent prosecutions include:
Employers who “pyramid” taxes by opening successive businesses
In January, Napoleon Robinson of Lauderhill, Florida, was sentenced to serve 18 months in prison for evading more than $500,000 in employment taxes. Robinson owned and operated a series of ship welding and repair businesses in Virginia and New York. Robinson was not paying over employment taxes and would close down one company and open a new one in the name of a nominee owner, while continuing to run the company, making its financial and personnel decisions and controlling the businesses’ bank accounts. He was also ordered to pay restitution to the IRS.
In January, two West Virginia business owners, Michael and Jeanette Taylor, were sentenced to serve 21 and 27 months in prison for failing to pay over more than $1.4 million in employment taxes. The Taylors owned a construction business that transported steel and sold gravel and concrete. They changed the name of their business several times, though the operations of the business remained the same. Both were responsible for collecting, accounting for and paying over the employment taxes withheld from their employees’ wages. Instead of paying over the taxes that they collected, the Taylors used the funds to purchase property and finance their horse farm. They were also ordered to pay restitution to the IRS.
Employers using withheld employment taxes for personal expenses
In January, Paul Harvey Boone of Hillsborough, North Carolina, was sentenced to serve 15 months in prison for failing to pay over employment taxes. Boone owned and operated Boone Audio Inc. From 2008 through 2011, Boone used company funds for personal expenses while failing to pay over the employment taxes withheld from his employees’ wages. He was also ordered to pay restitution to the IRS.
In December 2016, Sreedar Potarazu, a Maryland surgeon and entrepreneur, pleaded guilty to failing to account for and pay over $7.5 million in employment taxes and to shareholder fraud. Potarazu founded VitalSpring Technologies Inc., a corporation that provided data analysis and services related to health care expenditures. Potarazu was responsible for collecting, truthfully accounting for and paying over VitalSpring’s employment taxes. Instead of paying over the employment tax, Potarazu spent millions on personal expenses including transferring funds to himself and others, travel, car service and the publication of a book.
Employers using employment taxes to pay other creditors
In January, Steven Lynch, a tax attorney and owner of the Iceoplex in Pittsburgh, Pennsylvania, was sentenced to serve 48 months in prison, fined $75,000 and ordered to pay restitution to the IRS of more than $793,000, after being convicted of failing to collect, account for and pay over employment taxes. Lynch co-owned and operated the Iceoplex, a recreational sports facility which included a fitness center, ice rink, soccer court, restaurant and bar. He controlled the finances for these businesses and was responsible for collecting, accounting for and paying over tax withheld from employee wages and timely filing employment tax returns. Lynch failed to pay over more than $790,000 in employment taxes withheld.
In June 2016, Muzaffar Hussain of Pleasanton, California, pleaded guilty to failing to account for and pay over employment taxes for Crossroads Home Health Care Inc. Hussain was the CFO and was responsible for filing the company’s employment tax returns and paying over the employment taxes. Hussain transferred funds in an amount equal or close to the amount of employment taxes from the business bank account into other accounts and used the money to fund other business and personal expenses.
Employers paying employees in cash to avoid employment tax
In September 2016, Phillip Hui of Sicklerville, New Jersey, was sentenced to serve 15 months in prison for conspiring to evade payroll taxes on cash wages paid to illegal immigrants employed at his dry cleaning business. Hui hired foreign nationals from Mexico and Guatemala who did not have legal status in the United States and paid them in cash. Their wages were not reported on the quarterly employment tax returns filed with the IRS. He was also ordered to pay restitution to the IRS.
Employers filing false employment tax returns
In March, Richard Tatum, a Houston, Texas, business owner of an industrial staffing company, pleaded guilty to failing to pay more than $18 million in employment taxes. Tatum filed false employment tax returns that did not report the majority of his employees and did not pay over the taxes he withheld from his employees. stead, he used the money for luxury travel and to make payments on his ranch.
In January, Janis Ann Edwards, an Oklahoma City, Oklahoma, business owner, pleaded guilty to evading more than $3.5 million in employment taxes. Edwards was the sole owner of Corporate Resource Management c. and a number of related companies that operated as professional employer organizations. Edwards directed her employees to alter quarterly employment tax returns to reflect less payroll tax liability than was actually owed.
Delinquent Employers Also Risk Injunctions and Money Judgments
The Tax Division is also aggressively pursuing civil enforcement action against those who fail to meet their employment tax obligations. Since 2003, the Division has permanently enjoined more than one hundred employers and obtained tens of millions of dollars in money judgments. Civil injunctions are court orders requiring the employer and principal officers to timely deposit and pay employment taxes to the U.S. Treasury. These court orders also impose various other requirements and prohibitions, including the obligation to provide notice of each deposit to the IRS, as well as restrictions on opening and operating new businesses and transferring or dissipating assets.
In recent years, the Tax Division increased the number of civil actions brought against employers who violate employment tax laws. In 2016, the Tax Division obtained employment tax injunctions against 38 employers—more than double the number of injunctions obtained in 2015. The injunctions obtained in the past year include court orders against employers throughout the United States, such as a St. Louis concrete business, a Florida restaurant, an Iowa lawn care business and a Michigan custom kitchen company.
Since Jan. 1, the Tax Division filed 17 suits, collectively seeking more than $10 million in unpaid employment taxes, against tax-delinquent medical-care providers who, despite IRS notices and efforts to collect, have been non-compliant for three or more quarters, despite persistent attempts by the IRS to remind them of their obligations and to collect the unpaid taxes.
These 17 suits collectively seek more than $10 million in unpaid employment taxes and are part of an ongoing effort by the Justice Department and the IRS focusing on employment tax compliance. Among these cases is a suit filed in federal court in Minnesota to enjoin Dawda Sowe and Nurse Staffing Solutions Health Care from failing to pay employment taxes and to obtain a $2 million judgment against the business for employment taxes the business allegedly failed to pay over an eight-year period. Also, this month the Tax Division filed suit in federal court in Texas to obtain a court order requiring Jeanna Smith to timely file employment and unemployment tax returns for her business and pay those taxes in full, amongst other requirements. In this suit, the government also seeks a judgment for unpaid employment taxes and alleges that Smith incorporated several home-health care businesses, such as Paris Senior Care Group Inc., which accumulated more than $1.3 million in unpaid employment taxes.
Those Who Violate Injunctions are at Risk for Civil and Criminal Contempt
Those who violate an injunction can be charged with civil and criminal contempt and face being shut down, paying compensation for the damage the contempt caused and incarceration of the principal officer(s). For example, a federal court in Washington held Dr. James Hood and his wife, Karen Hood, in contempt of court for a consistent pattern of failing to meet their tax obligations. The court later ordered the two to close their dental care businesses, cease operating as employers, and barred them from opening any new businesses where the Hoods would serve as employers by June 8, 2017.
Liability Extends to Responsible Individuals
Any individual who is responsible for ensuring that employment taxes are collected, truthfully accounted for, and paid over to the IRS, and willfully fails to do so or willfully attempts to evade or defeat paying employment taxes may be subject to a civil penalty equal to the amount of the unpaid withholdings. This civil penalty, referred to as the trust fund recovery penalty, may be imposed even if the individual uses the employment tax to pay other creditors or keep the business afloat. Individuals subject to these penalties include, but are not limited to, corporate officers, treasurers, manager, and, in some circumstances, bookkeepers.
Since January 2013, the Tax Division has obtained tens of millions of dollars in money judgments against individuals subject to these penalties. For example, in July 2016, a Florida jury found the CEO and owner of a professional employer organization, David Goldberg of Deerfield Beach, Florida, personally liable for more than $4.2 million due to his failure to pay his company’s employment taxes. In addition, in December 2016, the U.S. Court of Federal Claims found that the CFO of an Internet-marketing platform, Mark V. Noffke, was responsible for his company’s failure to pay its employment taxes and entered a judgment of more than $500,000 against him. And in April, a federal court found the co-manager of an architectural woodwork installation company, Darren Commander of Jackson, New Jersey, personally liable for $1.9 million due to his failure to pay his company’s employment taxes.
These cases reflect the ongoing commitment of the Department of Justice and the IRS to pursue companies and individuals who fail to collect, account for, or pay employment taxes to the IRS. For more information about civil and criminal employment tax enforcement efforts, visit the Tax Division’s website.
Jury Convicts Port Orange Man for Firearms and Drug OffensesRead the Press Release
Orlando, Florida – Acting United States Attorney W. Stephen Muldrow announces that a federal jury today found Michael Anthony Conage (32, Port Orange) guilty of possessing hydromorphone with the intent to distribute it and possessing firearms and ammunition as a convicted felon. Due to his extensive criminal history, he faces a mandatory minimum sentence of 15 years, up to life, in federal prison pursuant to the Armed Career Criminal Act. His sentencing hearing is scheduled for July 19, 2017. Conage was indicted on January 25, 2017.
According to evidence presented at trial, over multiple days in August and September 2016, officers with the Port Orange Police Department observed Conage dealing drugs from an apartment. During the execution of a search warrant at the apartment, the officers located several different types of controlled substances, including a large amount of hydromorphone. They also recovered a stolen Glock handgun with an extended, loaded magazine and a loaded .380-caliber handgun. As a previously convicted felon, Conage is prohibited from possessing a firearm or ammunition under federal law.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Port Orange Police Department. It is being prosecuted by Assistant United States Attorney Embry J. Kidd.
This is another case prosecuted as a part of the Department of Justice’s “Project Safe Neighborhoods” Program - a nationwide, gun-violence reduction strategy. Acting United States Attorney Muldrow, along with Daryl R. McCrary, Special Agent in Charge, ATF, is coordinating the Project Safe Neighborhoods effort here in the Middle District of Florida in cooperation with federal, state, and local law enforcement officials.
Jury Convicts Cleburne Man of Sexual Enticement of a Minor via CraigslistRead the Press Release
LAREDO, Texas – A 47-year-old man has been convicted after posting an online advertisement seeking sexual contact with a young girl, announced Acting U.S. Attorney Abe Martinez along with Special Agent in Charge Shane Folden of Immigration and Customs Enforcement’s Homeland Security Investigations (HSI). The federal jury deliberated for less than two hours following a two-day trial before convicting Edwin Oland Andrus, of Cleburne.
During trial, the jury heard that Andrus posted an online advertisement on Craigslist seeking a “naughty little young girl.” An HSI special agent responded to the ad. Soon after, Andrus engaged in email and text communications with the undercover agent, believing the agent was a woman with a 14-year-old daughter. During those conversations, Andrus graphically and explicitly described sexual acts he wanted to perform on the woman and the young girl.
The jury also heard that Andrus offered to drive to Laredo on several occasions. Exactly one week after the agent initially responded to the ad, Andrus drove almost 400 miles from Cleburne to Laredo with the intention to engage in sexual contact with the minor female. He was arrested upon arrival on Jan. 13, 2017, at which time authorities discovered Andrus had brought with him condoms, personal lubricant and a “morning-after” pill.
Andrus had previously admitted he intended to have sex with the 14-year-old. At trial, however, he changed his story and said he did not plan to engage in sexual activity. The jury was not convinced and found him guilty as charged.
Sentencing will be set at a later date. At that time, Andrus faces a minimum of 10 years and up to life in federal prison and a possible $250,000 maximum fine. Andrus has been and will remain in custody pending that hearing.
HSI conducted the investigation. Assistant U.S. Attorneys Alfredo De La Rosa and Giselle S. Guerra are prosecuting the case.
Judge Sentences New York Woman to 5 Years in Prison for Refund Fraud SchemeRead the Press Release
Erie, Pa. – A former resident of Springfield Garden, New York has been sentenced in federal court to 60 months in jail and ordered to make restitution in the amount of $517,168.67 on her conviction of conspiracy to commit wire fraud, Acting United States Attorney Soo C. Song announced today.
United States District Judge David S. Cercone imposed the sentence on Bola Peters, 44.
According to information presented at her trial, Peters maintained multiple bank accounts which were used as repositories for fraudulently obtained federal tax refunds. After the fraudulently obtained refunds were deposited into accounts under her control, Peters would remove the funds, keep a portion for herself and remit the remainder of the refunds back to her co-conspirators. In addition, she was also in possession of numerous false identification documents. These documents matched the stolen identities listed on the fraudulent federal tax returns that generated the tax refunds deposited into the accounts Peters controlled. Other stolen identity documents found in Peters’ house matched the names on bank accounts Peters opened using stolen identities. Peters was also in possession of handwritten ledgers and lists containing hundreds of stolen identities that were used during the course of the conspiracy to file false federal tax returns.
Assistant United States Attorney Christian A. Trabold prosecuted this case on behalf of the government.
Acting U.S. Attorney Song commended the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation for the investigation leading to the successful prosecution of Peters.
Inmate Health Consultant Pleads Guilty to Lying to FBIRead the Press Release
BIRMINGHAM –A Vestavia Hills man pleaded guilty today in federal court to making a false statement to the FBI in relation to payments he received from a contractor providing inmate health care at the Jefferson County Jail, announced Acting U.S. Attorney Robert O. Posey and FBI Special Agent in Charge Roger C. Stanton.
MICHAEL P. GODDARD, 68, a consultant on inmate health at the county jail, entered his plea before U.S. District Court Judge R. David Proctor to falsely telling FBI agents that payments he received from a Jefferson County contractor were unrelated to a specific contract with the county jail. The U.S. Attorney’s Office charged Goddard in February. His sentencing date has not been set.
Birmingham FBI agents questioned Goddard in August 2016 while they were investigating recurring monthly payments to him from Davis & Associates, a Birmingham consulting firm, and “another entity that were funded by Health Assurance, LLC,” according to Goddard’s plea agreement in the case. Health Assurance had contracts with the Jefferson County Sheriff’s Office from 2007 through 2011 to provide health care to Jefferson County jail inmates.
The sheriff’s office contracted with Health Assurance in about February 2007, and the contract could be renewed yearly. Soon after Health Assurance began receiving payments from Jefferson County, Goddard began receiving monthly payments from Davis & Associates that were funded by Health Assurance, according to the plea agreement.
In July 2011, the payments to Goddard funded by Health Assurance began coming from a different entity, which the court documents do not name. The payments to Goddard continued to about October 2011, when Health Assurance’s contract with the Jefferson County Sheriff’s Office ended, the plea agreement states.
FBI agents interviewed Goddard on Aug. 31 and served him with a grand jury subpoena for records. The agents asked Goddard about the monthly payments he received that were funded by Health Assurance. Goddard told the agents that the monthly payments he received were unrelated to Health Assurance’s contracts with Jefferson County.
Goddard knew that statement was false “in that he knew the payments he received were directly related to the contracts, and he knew that this false statement was material to the FBI’s investigation,” the plea agreement states.
The maximum penalty for making a false statement to the FBI is five years in prison and a $250,000 fine.
The FBI is investigating the case, which Assistant U.S. Attorney George Martin is prosecuting.
Hospice Companies to Pay $12.2 Million to Settle Kickback ClaimsRead the Press Release
DALLAS – International Tutoring Services, LLC, f/k/a International Tutoring Services, Inc., and d/b/a Hospice Plus; Goodwin Hospice, LLC; Phoenix Hospice, LP; Hospice Plus, L.P.; and Curo Health Services, LLC f/k/a Curo Health Services, Inc. have agreed to pay $12.21 million to resolve allegations that they violated the False Claims Act by paying kickbacks in exchange for patient referrals, announced U.S. Attorney John Parker of the Northern District of Texas. Curo Health Services is headquartered in Mooresville, North Carolina and operates eight hospice affiliates across 18 states. In September 2010, Curo Health Services purchased Hospice Plus, Goodwin Hospice, and Phoenix Hospice, and consolidated the hospice companies under the Hospice Plus brand, which operates primarily in and around Dallas, Texas.
The settlement resolves allegations brought by several whistleblowers that Hospice Plus, Phoenix Hospice, and Goodwin Hospice submitted claims to Medicare and Texas Medicaid that were rendered false as a result of the payment of kickbacks by the hospices, its owners and employees, and others. There were two alleged kickback schemes. First, from 2007 through 2012, kickbacks were allegedly paid to American Physician Housecalls, a physician housecall company, in exchange for patient referrals to these hospice companies. The alleged kickbacks took the form of sham loans, a free equity interest in another entity, stock dividends, and free rental space. Second, from 2007 through 2014, kickbacks were allegedly paid to medical providers, including doctors and nurses as well as hospitals and long-term care facilities, in exchange for patient referrals to these hospice companies. The alleged kickbacks took the form of cash, gift cards, and other valuable items.
“We will not tolerate the payment of illegal kickbacks, which unjustly drive up the cost of health care,” said U.S. Attorney Parker. “Any health care provider who seeks to profit illegally at the expense of federal beneficiaries and taxpayers will face consequences.”
The allegations resolved by this settlement were raised in two consolidated whistleblower lawsuits in Dallas, Texas. The lawsuits were filed under the qui tam provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. In settling this matter, Curo Health Services did not admit any wrongdoing or liability.
In addition to reaching a settlement with these defendants, the United States also requested that the Court permit the United States to intervene in and prosecute the fraud claims against two former executives, Dr. Bryan White and Suresh Kumar. The case is captioned United States ex rel. Christopher Sean Capshaw, et al. v. Bryan K. White, et al.; Civil Action No. 3:12-cv-4457 (N.D. Tex.).
The Office of Inspector General of the U.S. Department of Health and Human Services and the FBI assisted in the investigation of this matter. The case is being handled by Assistant U.S. Attorneys Lindsey Beran and Kenneth Coffin.
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Hartford Man Pleads Guilty to Heroin and Firearm OffensesRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that DAVID VALENTIN, 37, of Hartford, pleaded guilty today before U.S. District Judge Michael P. Shea in Hartford to one count of possession with intent to distribute heroin, and one count of possession of a firearm in furtherance of a drug trafficking crime.
According to court documents and statements made in court, on January 29, 2016, VALENTIN was arrested after Hartford Police officers conducted a court-authorized search of his Congress Street residence and seized 2,684 wax folds of heroin, 15.1 grams of raw heroin and a loaded .380 caliber pistol that had been reported stolen.
VALENTIN’s criminal history includes nine felony convictions.
Judge Shea scheduled sentencing for October 10, 2017, at which time VALENTIN faces a mandatory minimum term of imprisonment of five years and a maximum term of imprisonment of life.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Hartford Police Department. The case is being prosecuted by Assistant U.S. Attorney Patricia Stolfi Collins.
Fugitive Pleads Guilty in $200 Million Credit Card Fraud ScamRead the Press Release
TRENTON, N.J. – A New York man today admitted his role in one of the largest credit card fraud schemes ever charged by the Justice Department, Acting U.S. Attorney William E. Fitzpatrick announced.
Habib Chaudhry, 49, of Valley Stream, New York, pleaded guilty before U.S. District Judge Anne E. Thompson in Trenton federal court to Count One of an indictment charging him with conspiracy to commit bank fraud.
Chaudhry was initially charged by complaint in February 2013 and then by indictment in September 2013. Chaudhry had been a fugitive for nearly four years prior to his arrest in January 2017.
According to documents filed in this case and statements made in court:
Chaudhry was indicted as part of a conspiracy – led by Tahir Lodhi, Babar Qureshi, Ijaz Butt, and others – to fabricate more than 7,000 false identities to obtain tens of thousands of credit cards. Including today’s plea, 20 people have pleaded guilty in connection with the scheme.
The scheme involved a three-step process in which the defendants would make up a false identity by creating fraudulent identification documents and a phony credit profile with the major credit bureaus; pump up the credit of the false identity by providing bogus information about that identity’s creditworthiness; then borrow or spend as much as they could without repaying the debts. The scheme caused more than $200 million in confirmed losses to businesses and financial institutions.
The scope of the criminal fraud enterprise required the conspirators to construct an elaborate network of false identities. Across the country, the conspirators maintained more than 1,800 “drop addresses,” including houses, apartments and post office boxes, which they used as the mailing addresses for the false identities.
Chaudhry admitted that he worked with others to obtain fraudulent credit cards in the names of false identities, that he directed that these fraudulent credit cards be mailed to addresses he controlled, and that he and others made charges using these credit cards with no intention of paying back the debts.
The conspiracy to commit bank fraud charge carries a maximum potential penalty of 30 years in prison and a $1 million fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for Sept. 20, 2017.
Acting U.S. Attorney Fitzpatrick credited special agents of the FBI’s Cyber Division, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked postal inspectors with the U.S. Postal Inspection Service, under the direction of Inspector in Charge James V. Buthorn, Newark Division, special agents of the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt, and the U.S. Social Security Administration for their assistance.
The government is represented by Assistant U.S. Attorneys Zach Intrater and Daniel Shapiro of the U.S. Attorney’s Office Economic Crimes Unit, as well as Assistant U.S.
Attorney Sarah Devlin of the Asset Forfeiture and Money Laundering Unit.
This case was brought in coordination with the Financial Fraud Enforcement Task Force, which was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
Defense counsel: Jerome Ballarotto Esq., Trenton
Franklin, Boonville Men Plead Guilty to Drug TraffickingRead the Press Release
JEFFERSON CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced that a Franklin, Mo., man and a Boonville, Mo., man pleaded guilty in federal court today to drug-trafficking charges.
Matthew Allen Hampton, 35, of Franklin, and Gregory Alan Kennedy, 53, of Boonville, pleaded guilty before U.S. Magistrate Judge William A. Knox to the charges contained in a July 20, 2016, superseding indictment.
By pleading guilty today, Hampton admitted he participated in a conspiracy to distribute methamphetamine in Boone, Cooper, Lafayette and Jackson Counties in Missouri from Aug. 25, 2015, to Jan. 11, 2016. Kennedy pleaded guilty to possessing methamphetamine with the intent to distribute.
Co-defendants Douglas Marion Pryor, 54, of Columbia, and Joseph Nicko Winters have also pleaded guilty to their roles in the conspiracy. Pryor is scheduled to be sentenced on May 24, 2017. Winters, who also pleaded guilty to distributing methamphetamine, possessing methamphetamine with the intent to distribute, and being a felon in possession of a firearm, is scheduled to be sentenced on May 16, 2017.
Hampton admitted that he was in possession of approximately two pounds of methamphetamine when he was stopped by Missouri State Highway Patrol troopers on I-70 in Lafayette County on Oct. 14, 2015. In addition to the methamphetamine, troopers found marijuana, drug paraphernalia and $3,353 in the vehicle. Hampton told investigators that Pryor had supplied him with the methamphetamine. They met in Pryor’s room at Harrah’s Casino in Kansas City, Mo., where Pryor handed him the methamphetamine and agreed to pay him $500 if he drove the methamphetamine back. Hampton admitted he had been dealing for Pryor for three or four months, and had moved approximately three to five pounds of methamphetamine in the last three months.
Law enforcement officers contacted Hampton again on Nov. 24, 2015, at the Isle of Capri Hotel/Casino in Boonville, Mo. Hampton had a plastic bag that contained methamphetamine in his pants pocket and a blue plastic glove that contained 93.1 grams of methamphetamine in a coat pocket. Hampton told officers he received the methamphetamine from Pryor.
A Cooper County sheriff’s deputy initiated a traffic stop of Kennedy near the city limits of Boonville on Aug. 25, 2015. Officers located approximately one pound of methamphetamine hidden in the dashboard of the vehicle. Kennedy identified Pryor as the person for whom he was transporting the methamphetamine. Kennedy stated that Pryor told him he would pay him $700 to pick up what he believed to be marijuana and drive it to his residence, where Pryor would pick it up.
Under federal statutes, Hampton is subject to a mandatory minimum sentence of 10 years in federal prison without parole, up to a sentence of life in federal prison without parole. Kennedy is subject to a mandatory minimum sentence of five years in federal prison without parole, up to a sentence of 40 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. Sentencing hearings will be scheduled after the completion of presentence investigations by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Larry Miller. It was investigated by the Missouri State Highway Patrol, the Drug Enforcement Administration, the Cooper County, Mo., Sheriff’s Department and the East Central Drug Task Force.
Former Owner of Albuquerque Smoke Shop Sentenced to Prison for Conviction on Federal Synthetic Drug Trafficking ChargesRead the Press Release
ALBUQUERQUE – Firas Abuzuhrieh, 40, an Israeli national who is legal permanent resident residing in Albuquerque, N.M., was sentenced today in Santa Fe, N.M., to 30 months of imprisonment for his conviction on federal synthetic drug trafficking charges. Abuzuhrieh will be deported after completing his prison sentence.
Abuzuhrieh was the owner of the Ace Smoke Shop & Hookah Lounge (Smoke Shop) located on Juan Tabo Blvd. NE in Albuquerque, when he and his employee Islam Kandil, 42, an Egyptian national residing in Albuquerque, were arrested on Sept. 23, 2014, on a criminal complaint with trafficking in synthetic cannabinoids, more commonly known as “spice.” Abruzuhrieh and Kandil subsequently were charged in a three-count indictment with conspiracy to distribute “spice” and with distributing “spice.”
According to the indictment, the two men conspired to sell “spice” in Bernalillo County from Aug. 14, 2014 to Aug. 18, 2014. It also charged Kandil with selling “spice” to an undercover DEA agent at the Smoke Shop on Aug. 14, 2014, and that Abuzuhrieh sold “spice” to an undercover DEA agent at the Smoke Shop on Aug. 18, 2014.
The indictment was superseded in July 2015 to expand the time frame of the conspiracy to cover the period between Aug. 14, 2014 and Sept. 22, 2014. The superseding indictment also added three counts of possession of “spice” with intent to distribute against Abuzuhrieh.
Kandil pled guilty on Sept. 22, 2015, to an information charging him with delivery of misbranded food, drugs, or tobacco products into interstate commerce. Kandil was also sentenced on Sept. 22, 2015, to time served to be followed by a year of supervised release.
Abuzuhrieh elected to proceed to trial on the five-count superseding indictment, which concluded on Aug. 27, 2015, when the jury returned a verdict finding him guilty on all five counts. The evidence at trial established that Abuzuhrieh sold “spice” to an undercover DEA agent on Aug. 18, 2014. It also established that on Sept. 22, 2014, when DEA agents arrested Abuzuhrieh, he was in possession of a key that opened a suite located in the same complex as the Smoke Shop. When the agents searched the Smoke Shop and the suite, they found approximately 62 kilograms of “spice,” inclusive of packaging.
This case was investigated by the Albuquerque office of the DEA and was prosecuted by Assistant U.S. Attorneys Jennifer M. Rozzoni and Shana B. Long.
The controlled substance analogues charged in the indictment are commonly referred to as synthetic cannabinoids or “spice.” According to the DEA, over the past several years, there has been a growing use of synthetic cannabinoids. Smoke-able herbal blends marketed as being “legal” and providing a marijuana-like high have become increasingly popular because they are easily available and, in many cases, more potent and dangerous than marijuana. These products consist of plant material that has been coated with dangerous psychoactive compounds that mimic THC, the active ingredient in marijuana. These substances, however, have not been approved by the Food and Drug Administration for human consumption, and there is no oversight of the manufacturing process. Synthetic cannabinoids often are labeled as incense to mask their intended purpose.
Former City of Passaic Mayor Gets over Two Years in Prison for Taking $110,000 in Corrupt Payments from DevelopersRead the Press Release
NEWARK, N.J. – The former mayor of the City of Passaic, New Jersey, was sentenced today to 27 months in prison for taking $110,000 in corrupt payments from developers doing business in the city, Acting U.S. Attorney William E. Fitzpatrick announced.
Alex D. Blanco, 45, of Passaic, previously pleaded guilty before U.S. District Judge William J. Martini to an information charging him with one count of soliciting and accepting corrupt payments in connection with City of Passaic business. Judge Martini imposed the sentence today in Newark federal court.
“Mayor Blanco admitted to aggressively soliciting and accepting illegal payments from developers, taking for himself federal money that was intended to help provide housing for some of the city’s poorest residents,” Acting U.S. Attorney Fitzpatrick said. “This case demonstrates that public officials who exploit their office for personal gain can expect to be thoroughly investigated and aggressively prosecuted.”
“Public corruption is one of the FBI's top priorities,” Special Agent in Charge Timothy Gallagher of the FBI Newark Division said. “Today's sentencing of former Passaic Mayor Alex Blanco is indicative of how diligently the FBI and our law enforcement partners work corruption matters. We will continue to investigate allegations of public corruption thoroughly to ensure any person who misuses their public office for private gain is held accountable.”
“The mayor’s sentencing sends a message that no one is above the law. It is a testament to the hard work and dedication of our special agents and their law enforcement colleagues—job well done,” acting Special Agent in Charge Brian A. Michael, Homeland Security Investigations, Newark Field office, said.
According to documents filed in this case and statements made in court:
From 2010 through 2012, two developers were seeking to build eight low-income residential units on property they owned in Passaic. After the Passaic City Council and the Passaic Zoning Board of Adjustment granted approval, Blanco – who had been mayor since November 2008 – had an intermediary approach the developers in July 2011. The developers were told they were expected to provide a sizable payment to the mayor to ensure that the project would proceed.
A short time later, the Passaic City Council approved the release of $216,400 in Housing and Urban Development (HUD) funds to the developers, money that had been earmarked for the project. In early September 2011, Blanco arranged for a meeting with the developers at which he solicited and agreed to accept $75,000. The next day, he arranged for a meeting with one of the developers in Clifton, New Jersey, and asked for the corrupt payment in cash, but was told by the developer that the developer had brought signed, blank checks, which could be made out to payees of Blanco’s choosing. Blanco obtained those checks – totaling $65,000 – once the payee lines had been filled in, arranged for them to be cashed, and pocketed the cash proceeds.
About eight days later, Blanco arranged for another meeting in Passaic with one of the developers and solicited and accepted two additional checks totaling $40,000, proceeds of which were ultimately provided to Blanco in cash. In March 2012, Blanco accepted cash proceeds from an additional $5,000 check solicited on his behalf. Much of the $110,000 in corrupt payments was derived from the HUD monies that had been released to the developers in 2011.
In addition to the prison term, Judge Martini sentenced Blanco to three years of supervised release and ordered him to pay restitution of $110,000.
Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Gallagher; and special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, under the direction of Acting Special Agent in Charge Michael, with the investigation leading to today’s sentencing. He also thanked special agents of the Office of Inspector General, U.S. Department of Housing and Urban Development, under the direction of Special Agent in Charge Christina Scaringi, for their assistance in the investigation.
The government is represented by Assistant U.S. Attorney Mark J. McCarren of the U.S. Attorney’s Office Special Prosecutions Division in Newark and Assistant U.S. Attorney James M. Donnelly of the Criminal Division in Newark.
Defense attorneys: Joseph A. Hayden Jr. Esq. and Aidan P. O’Connor Esq., Hackensack, New Jersey
Florida Resident Sentenced to Life in Prison for Attempting to Possess a Weapon of Mass Destruction and Provide Material Support to a Terrorist OrganizationRead the Press Release
Harlem Suarez, aka “Almlak Benitez,” 23, of Monroe County, Florida, was sentenced to life in prison for attempting to use a weapon of mass destruction, an explosive device, and attempting to provide material support to Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization.
The announcement was made by Acting Assistant Attorney General for National Security Mary B. McCord, U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, and members of the South Florida Joint Terrorism Task Force (JTTF). Suarez was sentenced by U.S. District Judge Jose E. Martinez in Key West to life in prison for the weapon of mass of mass destruction count of conviction and a concurrent term of 20 years in prison for attempting to provide material support.
Suarez, a U.S. legal resident and citizen of Cuba, was convicted at trial in Key West, Florida on January 27, of knowingly attempting to use a weapon of mass destruction against a person or property within the U.S., in violation of Title 18, U.S. Code, Section 2332a(a)(2) and attempting to provide material support to a terrorist organization, in violation of Title 18, U.S. Code, Section 2339B.
According to evidence introduced at trial, in April 2015, Suarez’s Facebook postings contained extremist rhetoric and promoted ISIS. Evidence further indicated that Suarez told an FBI confidential human source that he wanted to make a “timer bomb.” Suarez purchased components for this device, which was to contain galvanized nails, be concealed in a backpack and be remotely detonated by a cellular telephone. Suarez intended to bury the device at a public beach in Key West and then detonate it.
Mr. Greenberg commended the investigative efforts of the FBI; South Florida JTTF, Bureau of Alcohol, Tobacco, Firearms, and Explosives; U.S. Immigration and Customs Enforcement, Homeland Security Investigations; Key West Police Department, Monroe County Sheriff’s Office;s and Palm Beach County Sheriff’s Office. This case is being prosecuted by Assistant U.S. Attorneys Marc S. Anton and Karen E. Gilbert with assistance from the National Security Division’s Counterterrorism Section.
Florida Man Sentenced to Nearly 20 Years for Transporting Child PornographyRead the Press Release
Tampa, FL – U.S. District Judge Virginia M. Hernandez Covington today sentenced Tyler Dwayne Waddle (35, Tampa) to 19 years and 7 months in federal prison for transporting child pornography. The Court also ordered him to forfeit an iPod Touch, which he had used to store and send this child pornography. Waddle pleaded guilty on January 31, 2017.
According to court documents, Waddle transported child pornography to undercover agents in May 2016. Agents also forensically reviewed Waddle’s iPod Touch and discovered that it contained approximately 1,900 images of child pornography, at least some of which were sadistic images of prepubescent children.
“Today this predator is being held accountable for his deviant crimes,” said Susan L. McCormick, special agent in charge of HSI Tampa. “But what we’d like everyone to remember is the victims of these horrendous crimes will be affected for their entire lifetime.”
This case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. It was prosecuted by Assistant United States Attorney Gregory T. Nolan.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Federal Jury Convicts Dallas Man of November 2015 Armed Assault on Federal OfficersRead the Press Release
DALLAS — Following a four-day trial before U.S. District Judge Sam A. Lindsay, yesterday a federal jury convicted Victor Manuel Solorzano, 32, of Dallas, of five counts stemming from the November 19, 2015 armed assault of two federal law enforcement officers in southwest Dallas, announced U.S. Attorney John Parker of the Northern District of Texas.
Specifically, Victor Solorzano was convicted of one count of possession with intent to distribute methamphetamine, two counts of assault of a federal officer, and two counts of using, carrying, brandishing and discharging a firearm during and in relation to a crime of violence. The methamphetamine distribution count and the assault counts carry a maximum statutory penalty of 20 years in federal prison each. The firearm offenses is punishable by not less than thirty-five years and up to life. These sentences must run consecutive to any sentences for the drug and assault offenses. Sentencing is set for August 21, 2016.
“These convictions clearly demonstrate that violent drug traffickers will be vigorously prosecuted by this office, particularly when their violence is directed at law enforcement officers, and the punishment they face upon conviction will be substantial,” said U.S. Attorney Parker.
Co-defendant Edgar Solorzano, 24, pleaded guilty earlier this month to one count of possession with intent to distribute a controlled substance, two counts of assault on a federal officer and one count of using, carrying, brandishing and discharging a firearm during in relation to a crime of violence. Sentencing is set for August 7, 2017.
According to evidence presented at trial, on November 19, 2015, Victor and Edgar Solorzano, cousins who lived across the street from each other, fired numerous gunshots at two federal officers with the U.S. Department of Homeland Security, Homeland Security Investigations (HSI) with high-powered, semi-automatic firearms, and riddled their pickup truck with bullets as the officers fled for their lives.
Officers went to install a court-ordered tracking device on Victor Solorzano’s vehicle at his residence on Wilbur Street in Dallas, Texas. Victor was under federal investigation by HSI for trafficking methamphetamine at the time. Immediately after installing the tracking device on Victor’s vehicle, Victor, armed with a high-powered AR 15 pistol, confronted the officer in the street and began firing at the officer, striking him in the hand and foot. Edgar, meanwhile, was armed with a high-powered AK 47 pistol. The officer ran for his life as Victor and Edgar fired at him. The officer then got inside the passenger’s side of a pickup as Victor and Edgar began firing numerous gunshots at the two federal officers, who did not return fire. Victor and Edgar continued firing at the federal officers as they sped away. The officer who installed the court-ordered tracking device sustained four nonfatal bullet wounds and the pickup driven by the other officer sustained numerous bullet strikes, all from the back. Miraculously, the officers were not severely injured or killed. In total, the Solorzano cousins fired at least 42 gunshots at the federal officers on a residential street, and their turbulent gunfire even struck other vehicles and a home situated on the street.
After the shooting, Edgar hid the AK 47 pistol he used in the attic of his residence and the AR 15 pistol used by Victor in a neighbor’s backyard. The police searched Edgar’s residence and found the pistol hidden in the attic. The police also found in Edgar’s bedroom more than eight grams of methamphetamine, drug-distribution paraphernalia, and a variety of firearms and ammunition. The police later found the pistol used by Victor in the neighbor’s backyard. The police also searched Victor’s residence and found a gallon-sized ziplock bag containing methamphetamine residue in his closet. A narcotics detective estimated that the bag had contained approximately one to two pounds of the drug. The police also found in Victor’s residence drug-cash and a variety of firearms and ammunition.
The Federal Bureau of Investigation, the Dallas Police Department and U.S. Immigrations and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) investigated. Deputy Criminal Chief Assistant U.S. Attorney Gary Tromblay and Assistant U.S. Attorneys John Kull and Rachael Jones prosecuted.
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Falls Church Man Found Guilty of Sexually Assaulting College Student Who Was Walking on Northwest Washington StreetRead the Press Release
WASHINGTON – Sergio Velasquez Cardozo, 35, formerly of Falls Church, Va., has been found guilty by a jury of charges stemming from an incident in which he snuck up on a college student and grabbed and groped her, announced U.S. Attorney Channing D. Phillips.
A jury found Velasquez Cardozo guilty on April 17, 2017, of kidnapping, third-degree sexual abuse, fourth-degree sexual abuse and misdemeanor sexual abuse. The verdict followed a trial in the Superior Court of the District of Columbia. He is to be sentenced on June 9, 2017, by the Honorable Lynn Leibovitz. Under the District of Columbia’s voluntary sentencing guidelines, Velasquez Cardozo faces a likely range of three to seven years in prison. He also will be required to register as a sex offender for a 10-year period following his release from prison.
According to the government’s evidence, at approximately 1 a.m. on Sept. 17, 2016, the victim was walking home to her apartment on the Georgetown University campus. While walking in the 3400 block of Prospect Street NW, Velasquez Cardozo snuck up behind her, grabbed her in a bear hug and fondled her breast and buttocks.
Officers with the Metropolitan Police Department (MPD) happened to be driving slowly right behind, and next to, Velasquez Cardozo when he attacked the woman. They immediately stopped and arrested him. He has been in custody ever since.
In announcing the verdict, U.S. Attorney Phillips praised the work of officers from MPD’s Second District and from MPD’s Sexual Assault Unit. He also expressed appreciation for the work of the Georgetown University Police Department, which arrived on the scene shortly after Velasquez Cardozo was apprehended, and assisted both the victim and the MPD officers. He acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist Brenda C. Williams, former Paralegal Specialist Joyce Arthur, Victim/Witness Advocate Veronica Vaughan, and Litigation Technology Specialist Aneela Bhatia and Anisha Bhatia. Finally, he commended the work of Assistant U.S. Attorneys Kathleen “Katie” Kern and Peter V. Taylor, who investigated and prosecuted this case.
Essex County, New Jersey, Man Sentenced to over Eight Years in Prison for Possessing Firearm as A Previously Convicted FelonRead the Press Release
NEWARK, N.J. – A Newark, New Jersey, man was sentenced today to 105 months in prison for possessing a firearm as a previously convicted felon, Acting U.S. Attorney William E. Fitzpatrick announced.
Lucas Sumler, 42, was convicted in October 2016 of felony possession of a firearm following a two-day trial before U.S. District Judge Esther Salas in Newark federal court.
According to documents filed in this case and the evidence presented at trial, on March 25, 2016, Sumler – who had been previously convicted in U.S. District Court in New Jersey – was found in possession of a .357 magnum revolver along with six rounds of ammunition.
In addition to the prison term, Judge Salas sentenced Sumler to three years of supervised release.
Acting U.S. Attorney Fitzpatrick credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), under the direction of Acting Special Agent in Charge Scott C. Curley, along with the Newark Police Division and the Essex County Prosecutor’s Office, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Jonathan W. Romankow and Special Assistant U.S. Attorney Stephanie Raney of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Michael N. Pedicini Esq., Chatham, New Jersey
Essex County, New Jersey, Man Admits Summer 2016 Bank Robbery SpreeRead the Press Release
NEWARK, N.J. – A Newark, New Jersey, man today admitted robbing four banks in August and September 2016, Acting U.S. Attorney William E. Fitzpatrick announced.
James Lockwood, 39, pleaded guilty before U.S. District Judge Esther Salas in Newark federal court to an information charging him with four counts of bank robbery. He was originally arrested by state authorities on Sept. 23, 2016 and has been in custody since that time.
According to documents filed in this case and statements made in court, Lockwood robbed the following banks on the dates set forth below:
Bank
Location
Date
M & T Bank
Lyndhurst, New Jersey
Aug. 16, 2016
Schuyler Bank
Kearney, New Jersey
Aug. 25, 2016
Schuyler Bank
Kearney, New Jersey
Sept. 8, 2016
Capital One Bank
Clifton, New Jersey
Sept. 16, 2016
Lockwood admitted that during each of the above robberies, he threatened to use force while demanding money from the bank employees. He also robbed the same Schuyler Bank on Aug. 25, 2016 and Sept. 8, 2016.
The bank robbery charges each carry a maximum penalty of 20 years in prison and a $250,000 fine. Sentencing is scheduled for Aug. 2, 2017.
Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to today’s guilty plea. He also thanked the Hudson County Prosecutor’s Office, the Passaic County Prosecutor’s Office, and the Kearny and Clifton Police Departments for their assistance.
The government is represented by Assistant U.S. Attorney Sammi Malek of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Keith Hirschorn, Esq.
Drug Trafficker Who Ran Cocaine Importation Scheme Out of His Family’s Queens-Based Restaurant Receives 18-Year Prison SentenceRead the Press Release
Earlier today, United States District Judge Raymond J. Dearie sentenced the defendant Gregorio Gigliotti to 18 years in prison for narcotics-trafficking and firearms-related offenses.
The sentence was announced by Bridget M. Rohde, Acting United States Attorney for the Eastern District of New York; William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); and Angel M. Melendez, Special-Agent-in-Charge, U.S. Immigration and Customs Enforcement, Homeland Security Investigations (HSI), New York.
Following a two-week trial in July 2016, a federal jury in Brooklyn, New York found the defendant Gregorio Gigliotti and his son, Angelo Gigliotti, guilty of participating in a long-running cocaine importation scheme. The jury also found the defendant guilty of unlawfully possessing firearms – including a defaced firearm – in furtherance of the drug-trafficking operation. The defendant’s wife, Eleonora Gigliotti, also participated in the family-run drug-trafficking operation, and in January 2017, pled guilty to conspiring to import cocaine. Angelo Gigliotti and Eleonora Gigliotti are awaiting sentencing, and face mandatory minimum sentences of 20 years and 5 years, respectively.
The defendants’ arrests arose out of a long-term investigation by the United States Immigration and Customs Enforcement (“ICE”) and the Federal Bureau of Investigation (“FBI”), in coordination with law enforcement authorities in Italy, into a transnational cocaine trafficking operation. Between October and December 2014, federal law enforcement officers intercepted and seized approximately 55 kilograms of cocaine that had been hidden inside cardboard boxes that contained cassava and sent from co-conspirators in Costa Rica to the defendants in New York. To facilitate their operation, the defendants used their family-run Italian restaurant in Corona, Queens, Cucino Amodo Mio, as well as a produce importation company, Fresh Farm Export Corp., that was incorporated in 2012 to provide a cover for their drug-trafficking operation. On March 11, 2015, the day the defendants were arrested, federal law enforcement officers executed a search warrant at Cucino Amodo Mio and recovered one 12 gauge shotgun; one loaded .357 magnum Trooper revolver; one loaded .22 caliber Colt pistol; one loaded .38 caliber Charter Arms revolver; one 9 mm Keltec pistol; one .762 Czech pistol; one .38 caliber Derringer that had a defaced serial number; ammunition magazines; loose ammunition; two handgun holsters; brass knuckles; a handwritten ledger showing the movement of more than $350,000; and more than $100,000 in cash.
The government’s case is being handled by the Office’s Organized Crime & Gangs Section. Assistant United States Attorneys Margaret E. Gandy and Keith D. Edelman are in charge of the prosecution..
The Defendants:
GREGORIO GIGLIOTTI
Age: 61
Malba, New York
E.D.N.Y. Docket No. 15-CR-204 (S-2) (RJD)
Davenport Alderman Bill Boom Pleads Guilty to Making False Statements to a Federal Grand JuryRead the Press Release
DAVENPORT, IA - On April 18, 2017, William John Boom, age 65, from Davenport, Iowa, pleaded guilty to making false statements to a federal grand jury, announced United States Attorney Kevin E. VanderSchel. This charge carries a maximum potential penalty of not more than five years of imprisonment, up to a $250,000 fine, a term of supervised release of not more than three years, and a $100 special assessment to the Crime Victims' Fund. Sentencing is scheduled for August 24, 2017, at 2:30 p.m. at the United States Courthouse in Davenport. Boom was released pending sentencing pursuant to standard release conditions.
In July 2016, Boom was placed under oath and testified in front of a federal grand jury. He was advised by an Assistant United States Attorney of his oath to testify truthfully and the potential criminal penalties for providing false testimony. During his testimony, Boom made the following declarations in response to questions from the Assistant United States Attorney:
(i) Q: Prior to April 6th of 2016, were you aware that G.W. used methamphetamine?
A: I wasn't aware that he used methamphetamines. There was a time when I found a syringe in his room, but he told me that that was from one of his frineds that had diabetes. But every time that I suspected something, I would give him holy hell.
Q: So prior to April 6th of 2016, were you aware that G.W. used ice methamphetamine?
A: No.
Q: Have you ever given the person depicted in Exhibit I any money?
A: No. The only person I ever gave money to was G.W., or his relatives, but never to this gentleman.
The person depicted in Grand Jury Exhibit I was Joseph Allen Terry, also known as Lump and/or Lumpy. At the time Boom made these declarations, he knew his answers were false. Prior to April 6, 2016, Boom knew G.W. used methamphetamine and Boom had given money to Terry, who has since pleaded guilty to conspiracy to distribute methamphetamine and is pending sentencing on May 25, 2017. These questions and answers were material to an investigation into the distribution of methamphetamine in Southeastern Iowa.
This case was investigated by the Scott County Sheriff's Office. The case was prosecuted by the United States Attorney's Office for the Southern District of Iowa.
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Learn more about this release by calling Rachel J. Scherle at 515-473-9300, or by emailing her at [email protected].