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15 March 2017
National Youth Violence Prevention Week Events AnnouncedRead the Press Release
BOSTON – The Boston Interagency Committee on Violence Prevention announced its annual anti-violence creative contests and a call for all Boston Public school students to participate. Winners will be announced during the City’s National Youth Violence Prevention Week festivities, April 3 – 7.
Students in grades K-8 are invited to submit posters, middle school students can submit poetry, and high school students can enter their own music videos – all must reflect this year’s theme, “Youth Standing Strong Against Violence.” Prizes include gift cards, tickets to Red Sox and Celtics games, and an interview on JAM’N 94.5. Contest winners will be revealed at the annual city-wide Peace Rally at the Reggie Lewis Track & Athletic Center at Roxbury Community College on April 6, 2017 from 5:30 to 7:30 pm.
Information on the contests and Peace Rally is available at https://www.boston.gov/calendar/youth-peace-rally or by emailing [email protected].
Other National Youth Violence Prevention Week events include a program at the J.W. Hennigan School in Jamaica Plain, merging the U.S. Attorney’s “Your Future, Your Decision” presentation with the Suffolk County District Attorney’s “Overcoming Violence” graduation, as well as a Flashlight Walk with the Boston Police Department.
National Youth Violence Prevention Week aims to raise awareness and educate young people, parents, and communities as a whole, about effective ways to prevent and reduce youth violence. The campaign, which is held in cities across the country, features activities, competitions and events that bring young people together to make their schools and communities safer using peaceful forms of self-expression.
The Boston Interagency Committee on Violence Prevention consists of representatives from the U.S. Attorney’s Office, Office of the Governor, Massachusetts Attorney General’s Office, MassHousing, Suffolk County District Attorney’s Office, Suffolk County Sheriff’s Department, City of Boston Mayor’s Office, Boston Police Department and the Boston Centers for Youth & Families.
JAM’N 94.5 Radio, Roxbury Community College, Crystal Rock Beverages and the Boston Police Athletic/Activities League are sponsoring the contests and Peace Rally.
Monument Company Worker Embezzled $12.9 Million from EmployerRead the Press Release
PITTSBURGH – An Allegheny County resident pleaded guilty in federal court to charges of mail fraud, wire fraud, tax evasion, and money laundering, Acting United States Attorney Soo C. Song announced today.
Cynthia A. Mills, 56, of McKees Rocks, Pa., pleaded guilty to six counts (one count of mail fraud, three counts of wire fraud, one count of tax evasion, and one count of engaging in monetary transactions in criminally derived property) before United States District Judge Nora Barry Fischer.
In connection with the guilty plea, the court was advised that from February 1999 to May 2015, Mills embezzled $12,969,774.42 from Matthews International Corporation where she was employed as a Cashier and Treasury Specialist.
Judge Fischer scheduled sentencing for July 28, 2017, at 9:30 a.m. The law provides for a total sentence of 95 years in prison, a fine of $1,500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Shardul S. Desai is prosecuting this case on behalf of the government.
The Internal Revenue Service and the U.S. Postal Inspection Service conducted the investigation that led to the prosecution of Mills.
Mexican Citizen Pleads Guilty to Immigration ChargeRead the Press Release
Lynchburg, VIRGINIA – A citizen of Mexico, who on four occasions was removed from the United States only to return later without lawful permission, pled guilty this afternoon to a federal immigration charge, Acting United States Attorney Rick A. Mountcastle announced.
Adolfo Castaneda-Garcia, 45, a native of Mexico, pled guilty today in the United States District Court for the Western District of Virginia in Lynchburg to one count of illegally reentering the United States without obtaining express consent of the Secretary of the Department of Homeland Security to reapply for admission.
According to evidence presented at today’s guilty plea hearing by Assistant United States Attorney Charlene R. Day, Castaneda-Garcia was first encountered by Immigrations officials at or near Denver, Colorado in February 1996 while serving a state prison sentence for possession of a controlled substance. The defendant was sentenced to four years in prison for this conviction and later removed to Mexico. Over the next decade, Castaneda-Garcia was arrested, incarcerated, removed from the United States and encountered by Border Patrol officers at least four times in Arizona, California and Texas.
On June 17. 2016, officials with the Rockbridge Regional Jail in Lexington, Va., contacted officials with Immigrations and Customs and Enforcement officers and informed them that Castaneda-Garcia was arrested in Buena-Vista on state drug charges.
U.S. Department of Homeland Security, ICE- Enforcement and Removal Services conducted the investigation of the case. Assistant United States Attorney Charlene R. Day prosecuted the case for the United States.
Mexican Businessman Sentenced to Federal Prison for Pyramid SchemeRead the Press Release
In El Paso today, a federal judge sentenced 40-year-old self-proclaimed licensed investment broker Roberto Trinidad Del Carpio Frescas to 235 months in federal prison followed by three years of supervised release for carrying out a Ponzi scheme that resulted in an estimated $14 million loss announced United States Attorney Richard L. Durbin, Jr., U.S. Secret Service Special Agent in Charge Lee Dotson and El Paso Police Chief Greg Allen.
During sentencing, United States District Judge David C. Guaderrama scheduled a hearing on May 25, 2017, to determine the amount of restitution in this case. Del Carpio has remained in federal custody since his arrest in February 2015.
On February 19, 2016, a federal jury convicted Del Carpio of Chihuahua, MX, of 24 counts of wire fraud and ten counts of money laundering.
Evidence presented during trial revealed that the defendant held himself out to have superior knowledge and ability as an investor in stocks, bonds, futures in oil, gas, precious metals and currency. Though he was not licensed in the state of Texas as a dealer, or registered as an investment adviser, Del Carpio formed several companies in Texas including SMI International Institute Corporation (aka Stock Market Investment), Del Carpio Trading Institute LLC, and one in the Cayman Islands, Del Carpio Holdings, to facilitate his scheme.
From August 2010 until January 2012, Del Carpio and others collected money from over 100 known investors in Mexico and the United States. Del Carpio pocketed most all of the funds he collected though he did pay minimal amounts of money to “early” investors as a return on their investment and to encourage his victims to invest more of their money with him.
On March 3, 2017, Del Carpio’s co-defendant, 61-year-old David Brian Binder of Pittsburg, PA, pleaded guilty to one count of wire fraud. By pleading guilty, Binder admitted to helping Del Carpio keep proceeds from the scheme out of the hands of potential creditors as well as lying to them about protecting their investments. As a result, Binder faces up to 20 years in federal prison. He remains on bond pending sentencing scheduled for 9:00am on June 1, 2017, before Judge Guaderrama.
This investigation was conducted by the U.S. Secret Service and the El Paso Police Department. Assistant United States Attorneys Ian Hanna and Stanley Serwatka prosecuted this case on behalf of the Government.
Manchester Man Pleads Guilty to Bank RobberyRead the Press Release
CONCORD, N.H. – Acting United States Attorney John J. Farley announced that Brian Christoffels, 35, of Manchester, New Hampshire, pleaded guilty in federal court on Monday to one count of bank robbery.
According court records and statements made in court, Christoffels robbed the TD Bank at 293 S. Main Street in Manchester, New Hampshire, on October 10, 2016. Christoffels entered the bank, handed a bank teller a note demanding cash, then fled the area in his truck. Manchester Police pursued Christoffels and eventually arrested him at an off-ramp from Interstate 93.
A sentencing hearing is scheduled for June 27, 2017.
The case was investigated by the Manchester Police Department and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Shane Kelbley.
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Man Sentenced to 41 Months in Prison for Possession of Cocaine with Intent to DistributeRead the Press Release
St. Croix, USVI – District Court Judge Raymond L. Finch on March 14, 2017 sentenced Alejandro Marva-Romero, 33, of Venezuela, to 41 months in prison for possession of cocaine with intent to distribute, Acting United States Attorney Joycelyn Hewlett announced. Judge Finch also sentenced Marva-Romero to five years of supervised release and ordered him to pay a special assessment of $100.
On September 14, 2016, Marva-Romero pleaded guilty to possession of cocaine with intent to distribute. On November 13, 2015, Marva-Romero and other co-defendants traveled from St. Croix by boat to retrieve a load of cocaine mid-sea from a supply vessel. They transported the drugs in suitcases back to St. Croix and offloaded them at Knight’s Bay beach. Law enforcement tracked the boat as it returned to St. Croix and apprehended Marva-Romero and two co-defendants on the beach in close proximity to the suitcases. The suitcases contained 87 kilograms of cocaine.
The case was investigated by the U.S. Drug Enforcement Administration and was prosecuted by Assistant U.S. Attorney Alphonso G. Andrews, Jr.
Logan businessman pleads guilty to federal tax crimeRead the Press Release
CHARLESTON, W.Va. – A Logan man pleaded guilty today to a federal tax crime, announced United States Attorney Carol Casto. Timothy Moore, 54, entered his guilty plea for making a false statement on a tax return.
Moore admitted that from 2010 through at least 2013, he diverted checks intended for his business, Auto Body Specialists, LLC, an auto body and collision company located in Logan. Moore also admitted that the checks were payment for auto body or other work, and that he diverted the checks by depositing them directly into his personal bank accounts rather than into his company accounts. Moore additionally admitted that he hired an outside bookkeeper to prepare his personal and business taxes and to organize the books and records of the business. He admitted that he did not tell his bookkeeper about the diverted checks, nor did he provide the bookkeeper access to his personal bank accounts. When the bookkeeper filed joint income tax returns for Moore and his wife, Moore admitted that he knew that his tax returns understated his income from his company, as the returns did not take into account those diverted funds. Moore further admitted that he authorized the bookkeeper to file the false returns.
Moore specifically admitted that in tax years 2010, 2011, 2012, and 2013, he diverted $414,273.58 into his personal accounts that was not reported on his tax returns. Moore also admitted that the total tax loss for his criminal conduct is $127,926.26, and he admitted that he owes that same amount to the IRS as restitution.
Moore faces up to three years in federal prison and a fine of up to $250,000 when he is sentenced on June 8, 2017.
This case was investigated by agents of the IRS – Criminal Investigation Division. Assistant United States Attorney Meredith George Thomas is handling the prosecution. The plea hearing was held before United States District Judge Joseph R. Goodwin.
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Letcher County Business Owner Sentenced to 30 Months for Filing False Tax ReturnsRead the Press Release
LEXINGTON, Ky. – A business owner, who previously admitted he underreported more than $5 million in income over the course of three years, has been sentenced to 30 months in federal prison.
On Tuesday, U.S. District Judge Amul R. Thapar sentenced 38-year-old Jarrod C. Breeding, of Letcher County, for making false statements on tax returns filed with the IRS. Under federal law, Breeding must serve at least 85 percent of his sentence.
Breeding, the owner of Southern Steel Recycling in Isom, Ky., previously admitted that, for tax years 2011, 2012, and 2013, he underreported his income, by more than $5 million. Under federal law, domestic financial institutions, such as banks, must report any cash transaction at their institution that exceeds $10,000, as a way to assist in detecting crimes such as tax evasion.
Breeding underreported his income, in part, by structuring transactions, to avoid this $10,000 limit and the institution’s reporting requirements. This resulted in large amounts of money never being included on his bank statements. Then, when filing his tax returns, Breeding only reported the income that was actually included on his statements.
Breeding, who also owns 201 Speedway Racing in Isom, Ky., pleaded guilty in November 2016.
Carlton S. Shier, IV, Acting United States Attorney for the Eastern District of Kentucky, and Tracey D. Montaño, Special Agent in Charge, IRS Criminal Investigation, Nashville Field Office, jointly announced the sentence.
The case was investigated by IRS Criminal Investigations, and Assistant U.S. Attorneys Kate Anderson and Tiffany Fleming prosecuted the case on behalf of the federal government.
Lawrenceville, Illinois Man Sentenced on Methamphetamine Related ChargesRead the Press Release
Kedly G. Newlin, 57, of Lawrenceville, IL, was recently sentenced to federal prison on methamphetamine related charges, Donald S. Boyce, United States Attorney for the Southern District of Illinois, announced today.
On March 14, 2017, Newlin was sentenced to 235 months of imprisonment and five years of supervised release following his imprisonment. Newlin previously pleaded guilty to two counts in a federal indictment. Count 1 charged that from November 2015, until June 18, 2016, in Crawford, Lawrence, and Richland Counties, within the Southern District of Illinois, and elsewhere, Newlin and others conspired to distribute methamphetamine. The total amount of methamphetamine involved in the conspiracy was 50 grams or more of crystal methamphetamine, commonly known as "ice." Count 2 charged that on February 17, 2016, in Crawford County, Newlin knowingly and intentionally possessed with the intent to distribute methamphetamine.
The investigation in this case was conducted by the Crawford County Sheriff’s Office, the Robinson, Illinois Police Department, the Bridgeport, Illinois Police Department, the Lawrenceville County Sheriff’s Office, the Richland County Sheriff’s Office, and the Department of Homeland Security.
Investment Adviser Sentenced in Manhattan Federal Court for Insider Trading Scheme Involving Pharmaceutical Industry StocksRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that DAVID HOBSON, a former investment adviser, was sentenced to six months in prison for engaging in a scheme to commit insider trading in connection with deals involving a pharmaceutical company (the “Pharma Company”) at which Michael Maciocio, HOBSON’s friend, client and co-conspirator, worked. HOBSON pled guilty on October 25, 2016, to one count of conspiracy to commit securities fraud and one count of securities fraud before United States District Judge Laura T. Swain, who also imposed today’s sentence.
Acting U.S. Attorney Joon H. Kim said: “David Hobson used his relationship with a childhood friend to obtain inside information, and then traded on that information, making hundreds of thousands of dollars in illegal profits. The securities market must be free and fair for all, and our Office’s commitment to investigating and prosecuting insider trading remains firm.”
According to the allegations contained in the Indictment filed against HOBSON and his co-conspirator and statements made in related court filings and proceedings:
From May 2008 through April 2014, HOBSON and Maciocio participated in a scheme to commit insider trading in advance of, and in connection with, acquisitions and transactions under consideration by the Pharma Company. HOBSON and Maciocio were childhood friends and HOBSON had served as Maciocio’s investment adviser and broker for many years.
Maciocio learned about the impending transactions through his role as a master planner in the Active Pharmaceutical Ingredient Supply Chain Group at the Pharma Company. In that role, Maciocio was tasked with evaluating manufacturing demands and capacity within the Pharma Company and was consulted about potential acquisitions to assist in determining whether the Pharma Company would be able to manufacture any new product in-house. Although Maciocio was not typically provided with the names of the companies targeted for acquisition, he used the inside information he received – including the Pharma Company’s code names for the acquisitions, the drug indications, the dosages, the phases of any clinical trials, and the chemical structure of the drugs – to uncover the true identities of the target companies. At times, HOBSON assisted Maciocio in determining the identities of these target companies based on the inside information Maciocio had obtained as part of his job.
Having learned about these impending transactions, Maciocio, in breach of fiduciary duties and other duties of trust and confidence owed to the Pharma Company, traded on his own behalf and tipped HOBSON, so that HOBSON could use the information to trade for both himself and for Maciocio. HOBSON also used the inside information to trade on behalf of some of his other investment advisory clients.
HOBSON used the inside information that he received from Maciocio to make profitable trades in, among other securities: Medivation, Inc., Ardea Biosciences, Inc., and Furiex Pharmaceuticals, Inc. As a result of the scheme, HOBSON reaped approximately $165,000 in ill-gotten gains for himself, $40,000 for Maciocio, and nearly $150,000 for certain of HOBSON’s other clients.
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In addition to the term of imprisonment, HOBSON, 48, of Providence, Rhode Island, was sentenced to two years of supervised release and was ordered to forfeit $385,664.39.
Maciocio, 47, pled guilty to one count of conspiracy to commit securities fraud, one count of conspiracy to commit wire fraud, and two counts of securities fraud on May 20, 2016. His sentencing has not yet been scheduled.
Mr. Kim praised the work of the Federal Bureau of Investigation, and thanked the U.S. Securities and Exchange Commission.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Aimee Hector and Rebecca Mermelstein are in charge of the prosecution.
Guatemalan national sentenced for immigration crimeRead the Press Release
CHARLESTON, W.Va. – A Guatemalan national was sentenced today to credit for time served for an immigration crime, announced United States Attorney Carol Casto. Obed Zabaleta, 23, previously pleaded guilty to illegally reentering the United States. He has been in federal custody since November 9, 2016, and was remanded to the Department of Homeland Security for deportation proceedings.
Zabaleta had previously been removed from the United States to his home country of Guatemala on July 24, 2014, and again on January 15, 2015. Zabaleta then illegally reentered the United States and was found in Charleston after a traffic stop by the West Virginia State Police on November 9, 2016, on I-79 near Exit 1. Zabaleta had not formally applied for permission to legally reenter the United States and was not otherwise in the United States legally.
The Department of Homeland Security conducted the investigation, with assistance from the West Virginia State Police. Assistant United States Attorney Erik S. Goes is in charge of the prosecution. United States District Judge Thomas E. Johnston imposed the sentence.
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Gowanda Man Arrested and Charged with Production and Distribution of Child PornographyRead 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 Shane Michael Aurand, 20, of Gowanda, NY, was arrested and charged by criminal complaint with production and distribution of child pornography. The charges carry a mandatory minimum sentence of 15 years in prison, a maximum of 30 years, and a $250,000 fine.
Assistant U.S. Attorney Stephanie Lamarque who is handling the case, stated that according to the complaint, in March 2017, the defendant started communicating with an undercover law enforcement agent on the messaging application Kik. Aurand shared sexually explicit pictures of a seven-year-old child that he produced while babysitting the child at his house. The defendant also offered to send the undercover agent pictures of other children if he received child pornography in return.
The defendant made an initial appearance this afternoon before U.S. Magistrate Judge H. Kenneth Schroeder, Jr. and is being held pending a detention hearing on March 16, 2017, at 10:15 a.m.
The criminal complaint is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Adam S. Cohen.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Four Charged with Criminal Contempt of Court for Refusing to Testify at TrialRead the Press Release
PITTSBURGH – Three residents of Duquesne, Pennsylvania, and a resident of New Jersey, have been indicted separately by a federal grand jury in Pittsburgh, Pennsylvania, on charges of criminal contempt of court, Acting United States Attorney Soo C. Song announced today.
The one-count indictments, returned yesterday, named Khayri Battle, 36, of Newark, New Jersey, Shane Brooks, 30, Victoria Morgan, 32, and Bobby Rodgers, 48, all of Duquesne, Pennsylvania, as defendants.
According to the indictments, Battle, Brooks, Morgan and Rodgers refused to testify at the trial of Anthony Pryor and Lance Yarbough, for charges that included conspiracy to possess with intent to distribute and to distribute heroin, despite a written order compelling them to testify pursuant to a grant of immunity from United States District Court Judge Reggie B. Walton.
The law provides for an indeterminate prison sentence, an indeterminate fine, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendants.
Assistant United States Attorney Brendan T. Conway is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation conducted the investigation leading to the indictment.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former L.A. County Sheriff Lee Baca Found Guilty of Orchestrating Scheme to Obstruct Federal Investigation into JailsRead the Press Release
LOS ANGELES – Former Los Angeles County Sheriff Lee Baca was found guilty today of leading a conspiracy to obstruct justice by overseeing a scheme designed to impede a federal investigation into corruption and civil rights abuses at county jail facilities. Baca was also convicted of lying to federal investigators when he denied knowledge of key aspects of the obstruction plot.
After about two days of deliberations, a federal jury found that Baca authorized and condoned a scheme that now has resulted in the conviction of 10 former members of the Sheriff’s Department. During the trial, prosecutors described Baca as being the top figure in the conspiracy, which also involved his right-hand man and deputies who implemented orders from the Sheriff.
The jury convicted Baca on three felony counts: conspiracy to obstruct justice, obstruction of justice and making false statement to federal investigators. As a result of today’s guilty verdicts, Baca, 74, faces a statutory maximum sentence of 20 years in federal prison.
United States District Judge Percy Anderson, who has presided over several trials involving members of the conspiracy, is expected to schedule a sentencing hearing during a status conference on Monday.
The obstruction plot began in August 2011 after LASD officials discovered a cell phone in an inmate’s cell at the Men’s Central Jail, linked the phone to the FBI’s Civil Rights Squad and learned that the inmate was an FBI informant. The cell phone had been smuggled into the jail by a corrupt deputy who took bribes. The FBI developed the informant as part of an investigation into the county jail system, which for years had been the subject of allegations of inmate abuse and subsequent cover-ups. The evidence presented at trial showed that the Sheriff wanted to avoid federal scrutiny of his troubled jails.
As part of the obstruction scheme, Baca ordered a criminal investigation of the FBI agents conducting an undercover investigation, and he directed that the informant be concealed from federal investigators. Members of the conspiracy then hid the informant from federal authorities, engaged in witness tampering in an effort to prevent information from being shared with federal authorities, and threatened to arrest the lead FBI agent on the case.
While Baca put his right-hand man, then-Undersheriff Paul Tanaka, in charge of the scheme, Baca participated in dozens of meetings and phone calls with members of the conspiracy and admitted directing his deputies to approach the FBI agent. Baca participated in the scheme after being warned by a top deputy that the actions would amount to obstruction of justice.
“The former sheriff has now been held accountable for overseeing a widespread scheme to obstruct justice by issuing orders designed to protect a corrupt culture,” said Acting United States Attorney Sandra R. Brown. “As the Sheriff for Los Angeles County, Mr. Baca had a duty to uphold the law, a duty he utterly failed when he played an active role in undermining a federal investigation into illegal conduct at the jails. Today’s verdict shows that no one is above the law.”
“By obstructing the rule of law, Mr. Baca failed both the dedicated men and women of the largest sheriff’s department in the country, as well as the community he swore to serve,” said Deirdre Fike, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “As this dark chapter for the LASD nears to a close and the department embarks upon reform under new leadership, we owe a debt of gratitude to the agents and prosecutors who worked on this case over several years and, at times, under very difficult circumstances. Their unfailing commitment to this case and to rooting out corrupt officials can only restore faith in law enforcement going forward.”
The case against Baca is the result of an investigation by the Federal Bureau of Investigation and is one in a series of cases resulting from the investigation into county jail facilities in downtown Los Angeles that has resulted in 21 convictions.
As a result of today’s verdicts, Baca becomes the tenth member of the Los Angeles Sheriff’s Department to be convicted in the obstruction scheme, including former Undersheriff Paul Tanaka, who was sentenced to five years in federal prison.
Eleven other former deputies have been convicted of federal charges, mostly related to unprovoked beatings of inmates and subsequent cover-ups.
The investigation of this case was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Brandon Fox, Chief of the Public Corruption and Civil Rights Section; Assistant United States Attorney Lizabeth A. Rhodes, Chief of the General Crimes Section; and Assistant United States Attorney Eddie A. Jauregui of the Major Frauds Section.
Former Global Law Firm Partner Convicted of Insider TradingRead the Press Release
Earlier today, following a week and a half trial, a federal jury in Brooklyn, New York, returned a guilty verdict against Robert Schulman, a former partner of a Richmond-based global law firm, for securities fraud and securities fraud conspiracy. The indictment charged crimes stemming from Schulman tipping off the executive of an investment advisory firm about the pending merger between Pfizer, Inc. and King Pharmaceuticals, Inc. that Schulman had learned of through his representation of King Pharmaceuticals. Schulman and his co-conspirators then used that material non-public information to engage in securities transactions ahead of the merger announcement that resulted in more than $400,000 in illegal profits.
When sentenced by United States District Judge Joan M. Azrack, the defendant faces a maximum sentence of 20 years’ imprisonment.
The verdict was announced by Bridget M. Rohde, Acting United States Attorney for the Eastern District of New York, and Philip Bartlett, Inspector-in-Charge, United States Postal Inspection Service, New York Division (USPIS).
Ms. Rohde thanked the USPIS for its hard work and dedication in leading the investigation and expressed her appreciation to the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority, Inc., Criminal Prosecution Assistance Group (FINRA CPAG) for their cooperation and assistance.
The government’s case is being prosecuted by Assistant United States Attorneys David Pitluck and Julia Nestor of the Office’s Business and Securities Fraud Section.
The Defendant:
ROBERT SCHULMAN
Age: 58
McLean, Virginia
E.D.N.Y. Docket No. 16-CR-442 (JMA)
Former Bibb County Public Schools Employee Pleads Guilty to Student Loan FraudRead the Press Release
G.F. “Pete” Peterman, III, United States Attorney for the Middle District of Georgia, announces Queen Adeboyejo, age 64, of Perry, Georgia entered a guilty plea in federal court in Macon to Student Loan Fraud on March 15, 2017 before the Honorable Leslie Abrams, United States District Judge. Through her plea, Ms. Adeboyejo admitted that she obtained federal student loans fraudulently by using the personal identifying information of three individuals to file bogus endorsements necessary to obtain the loans.
Ms. Adeboyejo was pursuing her doctoral degree and was denied additional federal student aid due to her poor credit. In order to qualify for further federal student loans, it was required that she have another person sign an endorser addendum agreeing to repay her loans if she did not. Without their knowledge or consent, Ms. Adeboyejo obtained the personal identifying information (PII) of three individuals, one of whom she used to work with at the Bibb County Public Schools, and used the PII to create and submit forged endorsement addendums online. As the result of these addendums, Ms. Adeboyejo obtained $18,828.00 in federal student loans with one endorser and $75,166.00 in federal student loans with another endorser. She also attempted to obtain a total of $150,000.00 in federal student loans with another person as an endorser.
"Scams like this steal money from hardworking taxpayers and legitimate students and that is unacceptable," said Yessyka Santana, Special Agent in Charge of the U.S. Department of Education Office of Inspector General's Southeastern Regional Office. "The OIG is committed to fighting student financial aid fraud and we will continue to aggressively pursue those that participate in these types of crimes."
“Ms. Adeboyejo stole from the government student loan program, she stole from deserving students who were qualified to receive the money she fraudulently obtained, and she damaged the credit of those whose identities she stole to carry out her scheme,” said United States Attorney Peterman. “I commend the good work of the investigators at both the U. S. Department of Education Office of Inspector General and the Bibb County Sheriff’s Office for their fine work and cooperation in bringing Ms. Adeboyejo to justice.”
Sentencing has been scheduled for June 26, 2017 in Macon. At sentencing, Ms. Adeboyejo faces a maximum sentence of five years imprisonment, a maximum fine of $250,000, or both, and a term of supervised release of three years. As part of her plea, Ms. Adeboyejo has also agreed to pay $123,732.18 in restitution to the United States Department of Education.
This case was investigated by the U.S. Department of Education - Office of Inspector General and the Bibb County Sheriff’s Office - Property Crimes Division. Assistant United States Attorney Beth Howard is handling the prosecution for the Government.
Questions concerning this case should be directed to Brittney Kish Lightsey, United States Attorney’s Office, at (478) 621-2735.
Former Attorney Pleads Guilty to Bankruptcy FraudRead the Press Release
Tampa, FL – Acting United States Attorney W. Stephen Muldrow announces that Josiah E. Hutton (60, Winter Haven) today pleaded guilty to concealment of assets from a bankruptcy estate. He faces a maximum penalty of five years in federal prison. Sentencing has been set for June 5, 2017.
According to the plea agreement, Hutton was retained to represent a debtor who was planning to file for bankruptcy. In anticipation of filing a bankruptcy petition, Hutton received a settlement check, which was property of the debtor’s bankruptcy estate, and deposited it into his attorney escrow account. Hutton later prepared and certified the debtor’s bankruptcy petition, yet he failed to list the settlement check as an asset, thereby concealing the asset from creditors and the Bankruptcy Court.
This case was investigated by the Federal Bureau of Investigation and the Florida Department of Law Enforcement. It is being prosecuted by Special Assistant United States Attorney Chris Poor.
Final Defendant in Tax Scheme Sentenced in Federal CourtRead the Press Release
Lynchburg, VIRGINIA – A Lynchburg-based tax preparer, who along with two of his employees were preparing false tax returns in order to claim fictitious Earned Income Tax Credits, was sentenced today in the United States District Court for the Western District of Virginia in Lynchburg, Acting United States Attorney Rick A. Mountcastle announced.
Jackie G. Woodson Jr., of Lynchburg, previously pled guilty to one count of conspiracy to commit false claims. Today in District Court, Woodson was sentenced to 18 months in federal prison. Terry R. Rose was previously sentenced to 18 month in federal prison for her role in the conspiracy and Stella Hester-Jenkins was sentenced to 3 years’ probation.
According to evidence presented to the court during previous hearings by Assistant United States Attorneys C. Patrick Hogeboom III and Charlene R. Day, Woodson owned a Colbert/Ball Tax Service franchise in Lynchburg, Va., Rose and Hester-Jenkins were employed by Woodson as tax preparers.
Following an investigating by the Internal Revenue Service, it was determined that Woodson, Rose and Hester-Jenkins, were preparing and filing tax returns, which reported fictitious Schedule C income, which resulted in increased Earned Income Tax Credits and refunds. The conspirators often took these actions by claiming Schedule C income through babysitting or childcare income where none actually existed or by greatly exaggerating the amount of income being earned through these activities.
The Internal Revenue Service conducted the investigation of the case. Assistant United States Attorney C. Patrick Hogeboom III and Charlene R. Day prosecuted the case for the United States.
Federal Prison Correctional Officer Guilty of BriberyRead the Press Release
BEAUMONT, Texas – A 34-year-old federal prison guard has pleaded guilty to bribery in the Eastern District of Texas, announced Acting U.S. Attorney Brit Featherston today.
Anqunett Vernetta Lewis, of Houston, pleaded guilty to an Information charging her with bribery of a public official today before U.S. Magistrate Judge Zack Hawthorn.
According to information presented in court, from Feb. 22, 2015 to Nov. 9h, 2016, Lewis worked as a corrections officer for the Bureau of Prisons at the Federal Correctional Institution – Beaumont (FCI – Beaumont). During that time, she carried out the duties typical of a corrections officer – overseeing inmates, delivering food and other items to the inmates, and ensuring compliance with Bureau of Prisons and FCI – Beaumont rules, policies, and regulations.
Starting in October 2015 until January 2016, Lewis was paid by inmates to smuggle watches with cellular capabilities into FCI – Beaumont. Inmates in the Federal Bureau of Prisons are prohibited from possessing phones, watches, or other devices with cellular capabilities. Lewis admitted to smuggling in numerous watches and was paid by the inmates, or surrogates on their behalf, via wire transfer.
Under federal statutes, Lewis faces up to 5 years in federal prison at sentencing. The maximum statutory sentence prescribed by Congress is provided here for information purposes, as the sentencing will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the U.S. Probation Office.
This case was investigated by the Department of Justice – Office of the Inspector General and prosecuted by Assistant U.S. Attorney Christopher T. Tortorice.
Federal Grand Jury Indicts Three in Connection with Shooting of U.S. Mail CarrierRead the Press Release
In San Antonio this afternoon, a federal grand jury returned a 13–count indictment charging three San Antonio residents for their alleged roles in a mail theft scheme that involved the shooting of a U.S. Mail carrier last month in Spring Branch, TX, announced United States Attorney Richard L. Durbin, Jr.; Inspector in Charge Adrian Gonzalez, U.S. Postal Inspection Service, Houston Division; and, San Antonio Police Chief William McManus.
The indictment charges 22–year-old Bradley A’Hearn and 26–year-old Sara Richford with five counts of aiding and abetting assault of a federal officer; three counts of aiding and abetting use of a firearm during a crime of violence; one count of aiding and abetting carjacking; one count of aiding and abetting possession of a stolen firearm; and, one count of possession of stolen mail. The indictment also charges 40-year-old Piper Lee with two counts of aiding and abetting the assault of a federal officer; one count of aiding and abetting use of a firearm during a crime of violence; and, one count of possession of stolen mail.
Court records allege that on February 11, 2017, A’Hearn shot a female U.S. Mail carrier as she was delivering mail to cluster of mailboxes in Spring Branch, TX, when she would not give him her cell phone. The victim is recovering from a gunshot wound to her leg. A’Hearn left the scene in the victim’s pickup truck which still contained the victim’s purse and personal effects as well as a considerable amount of U.S. Mail. Richford, driving a maroon/brown colored Toyota Venza, followed A’Hearn as he left the scene.
Court records also allege that on February 13, 2017, a U.S. Postal Inspection Service agent near the site of the shooting recognized the Toyota Venza vehicle. The agent, while attempting to stop the vehicle, was allegedly fired upon by A’Hearn. Other law enforcement personnel, who subsequently joined the pursuit, were also fired upon by A’Hearn. The defendants managed to avoid capture.
Court records further allege that on February 14, 2017, agents were notified by employees of a local motel of the presence of a large amount of U.S. Mail and a handgun case in one of the motel rooms. Much of the discovered mail, originating from locations across the country, was destined for addresses in the Spring Branch, TX area. That same day, not far from the motel, investigators recovered the abandoned Toyota Venza. From motel surveillance footage, investigators discovered another vehicle being utilized by the defendants, a yellow Volkswagen. Agents observed the defendants leave the motel in the yellow Volkswagen and requested San Antonio police to initiate a stop of the vehicle. The defendants failed to yield to SAPD officers and the occupants began shooting at the police. Ultimately, the defendants abandoned their vehicle inside a parking garage of a local mall and managed to elude capture by law enforcement.
On February 15, 2017, San Antonio police officers, acting on information provided to investigators, arrested the defendants without incident in a parking lot of a different local motel.
Upon conviction, the defendants face between ten years and life in federal prison for aiding and abetting use of a firearm during a crime of violence; up to 25 years imprisonment for aiding and abetting carjacking; up to 25 years imprisonment for aiding and abetting robbery of mail; up to 20 years imprisonment for aiding and abetting assault on a federal officer; up to ten years imprisonment for aiding and abetting possession of a stolen firearm; and up to five years imprisonment for possession of stolen mail.
All three defendants remain in federal custody at this time.
It is important to note that an indictment is merely a charge and should not be evidence of guilt. The defendants are innocent until proven guilty in a court of law.
This matter is being investigated by the U.S. Postal Inspection Service together with the San Antonio Police Department, Texas Department of Public Safety, Texas Rangers, Comal County Sheriff’s Office, Bulverde Police Department, Federal Bureau of Investigation, U.S. Marshals Service and Homeland Security Investigations (HSI). Assistant United States Attorneys Bettina Richardson and Christina Playton are prosecuting this case on behalf of the Government.
Federal Grand Jury Indicts Dripping Springs Man for Making Threats to Kill Individuals on Fort HoodRead the Press Release
In Waco, a federal grand jury yesterday afternoon indicted a Dripping Springs man for allegedly making threats to kill individuals on Fort Hood last month announced United States Attorney Richard L. Durbin, Jr., and Federal Bureau of Investigation (FBI) Special Agent in Charge Christopher Combs, San Antonio Division.
The indictment charges 28-year-old Thomas Anthony Chestnut with one count of interstate communications with threat to injure. Upon conviction, Chestnut faces up to five years in federal prison.
According to court records, on February 22, 2017, Chestnut made verbal threats when he called and spoke with a sergeant at the US Army 1st Calvary Division at Fort Hood. Chestnut threatened to go to Fort Hood, kill the sergeant, take hostages, start a mass killing spree and then kill himself if he was not allowed to speak with someone of rank. Chestnut then spoke with a major and advised that he was a former soldier wrongly accused of a crime and eventually released from prison in 2016. Chestnut further advised if he was unable to speak with a U.S. Army III Corps Commander or a Sergeant Major regarding back pay, or did not receive the money he believed was owed to him, that he planned to shoot soldiers on Fort Hood.
“Threats of this nature are taken seriously,” stated United States Attorney Richard L. Durbin, Jr.
FBI agents arrested Chestnut without incident on February 24, 2017. He has remained in federal custody since. A detention hearing for Chestnut is scheduled for 1:30pm on March 22, 2017, before U.S. Magistrate Judge Jeffrey C. Manske in Waco.
This investigation is being conducted by the FBI together with the U.S. Army Military Police Investigations at Fort Hood and the Hays County Sheriff’s Office. Assistant U.S. Attorney Greg Gloff and Special Assistant U.S. Attorney/Active Duty U.S. Army Captain J. Patrick Robinson are prosecuting this case on behalf of the government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendant is presumed innocent until proven guilty in a court of law.
East Cleveland man indicted for robbing two banks on West 25th StreetRead the Press Release
An East Cleveland man was indicted for robbing two banks on West 25th Street this year, said Acting U.S. Attorney David A. Sierleja and FBI Special Agent in Charge Stephen D. Anthony.
Mark A. Lloyd, 31, robbed the Ohio Savings Bank on Jan. 30 of $918. Two weeks later he robbed the PNC bank of $4,238, according to the indictment.
Lloyd was arrested on Feb. 17 at Cleveland City Hall after a police officer working security there recognized Lloyd, particularly a tattoo of a gun underneath Lloyd’s right eye, according to court documents.
If convicted, the defendant’s sentence will be determined by the court after reviewing factors unique to this case, including the defendants’ prior criminal record, the defendant's role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case was investigating by the FBI and the Cleveland Division of Police. It is being prosecuted by Assistant U.S. Attorneys Elliot D. Morrison and Megan Miller.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
District Court Enters Permanent Injunction Against Virginia Company and Employees to Prevent Distribution of Adulterated Milk Powder ProductsRead the Press Release
The U.S. District Court for the Western District of Virginia entered a consent decree of condemnation and permanent injunction against Valley Milk Products LLC, Michael W. Curtis, Robert D. Schroeder, and Jennifer J. Funkhouser (defendants), the Department of Justice announced today. The consent decree also orders the condemnation of certain seized milk powder products and prevents the further distribution of adulterated milk powder products.
The Department filed a seizure action in the Western District of Virginia on Nov. 18, 2016, at the request of the U.S. Food and Drug Administration (FDA). The November complaint alleged that certain milk powder products of the defendants were manufactured under insanitary conditions whereby they may have become contaminated with filth, and/or whereby they may have been rendered injurious to health. That complaint sought to seize and condemn certain adulterated milk powder products at Valley Milk Products’ Strasburg, Virginia facility.
Yesterday’s filing resolves that seizure action and prohibits further use of the seized product unless specifically approved by the FDA, and additionally permanently enjoins the defendants from manufacturing milk powder products at their facility, absent compliance with certain specified remedial provisions.
“The Food, Drug, and Cosmetic Act is designed to bolster public confidence in food safety by protecting consumers from unsafe food, including food produced under visibly insanitary conditions,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “The Department of Justice will continue to work cooperatively with the FDA to ensure that food facilities employ proper precautions, so that our food is safe for consumption.”
Valley Milk Products LLC is a manufacturer of Grade A and non-Grade A milk products including, but not limited to milk powder products, condensed milk products, and butter. The permanent injunction also named Valley Milks’ General Manager Michael W. Curtis, Plant Manager Robert D. Schroeder, and Quality Control Compliance Officer Jennifer J. Funkhouser.
As alleged in the complaint, during a 2016 inspection of Valley Milk, FDA confirmed the presence of Salmonella meleagridis in the Strasburg facility. Salmonella strains were nearly identical to Salmonella strains found at the firm in 2010, 2011, and 2013. In addition, the complaint alleged that Salmonella meleagridis was also present in the firm’s undistributed finished product samples. The complaint also alleges that, in addition to the presence of Salmonella, the defendants’ milk processing facility had insanitary conditions, including dripping brown fluids and old product residue within the processing equipment. The complaint alleges that this evidence demonstrates that the firm’s sanitation practices were inadequate to control or eliminate Salmonella meleagridis in their processing environment.
The seized milk powder products have been condemned and forfeited to the United States. Under the provisions of the consent decree entered by the Court, Valley Milk may attempt to bring the condemned products into compliance with the Federal Food, Drug, and Cosmetic Act under the supervision of the FDA. Valley Milk is prohibited from disposing of any part of the condemned food until FDA determines that the food has been safely reconditioned. If the food cannot be reconditioned, it will be destroyed by a method approved by FDA.
The defendants have also agreed to be bound by a permanent injunction that prohibits them from resuming the manufacture of milk powder products at the Strasburg facility without implementing effective corrective action. If the defendants wish to resume manufacturing milk powder products at their Strasburg facility, the defendants must notify FDA in advance, and comply with certain remedial provisions set forth in the Decree. Among other things, the remedial provisions require that the defendants establish and implement a written sanitation control program, which shall set out the details for sanitation control over the manufacturing and storage processes for the facilities used to receive, manufacture, prepare, pack, hold, or distribute milk powder products, and all food handling and storage equipment therein. This action does not affect Valley Milk’s liquid milk products.
The government is represented by Trial Attorney Mary M. Englehart of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Joseph W.H. Mott of the U.S. Attorney’s Office for the Western District of Virginia, with the assistance of Associate Chief Counsel for Litigation Barbara J. Alkalay of the FDA, Office of General Counsel, Department of Health and Human Services.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for Western District of Virginia, visit its website at https://www.justice.gov/usao-wdva.
District Court Enters Permanent Injunction Against Colorado Companies to Stop Distribution of Adulterated and Misbranded Dietary Supplements and Unapproved and Misbranded DrugsRead the Press Release
WASHINGTON – The U.S. District Court for the District of Colorado has entered a permanent injunction against EonNutra LLC, two related companies, CDSM LLC and HABW LLC, and their owner, Michael Floren, to prevent the sale and distribution of adulterated and misbranded dietary supplements and unapproved and misbranded drugs, the Justice Department announced today.
The Department filed a complaint on March 10 in the U.S. District Court for the District of Colorado, alleging that the defendants, who sell some 150 dietary supplement products, violated the Federal Food, Drug, and Cosmetic Act (FDCA). Although labelled as dietary supplements, several of the defendants’ products were, according to the complaint, marketed as drugs, with claims that the products could help treat or prevent a host of serious conditions or diseases, including heart disease, diabetes, depression, hypertension, osteoporosis, and liver and kidney disorders. But, according to the complaint, the defendants offered these claims to the consuming public, notwithstanding the absence of FDA approval. Some of the specific products identified in the complaint as unapproved drugs were 4NOx2, HGH Night Time, rHGH Drops Black Label, Primal Rage Levo 5 GH Mass and Deer Antler Velvet Extract. Additionally, as the complaint alleges, the defendants sold these supplements without implementing the requisite procedures to validate the supplements’ composition.
“The Department of Justice will continue to work cooperatively with FDA so that consumers can be confident in the claims of sellers of drugs and dietary supplements,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “Manufacturers need to ensure the quality and identity of the ingredients that go into their products, so that such products are safe for consumers and the public can rely on the integrity of those products.”
“Lying to the public so you can make money is a bad idea,” said Acting U.S. Attorney for the District of Colorado Bob Troyer. “Doing it in a way that jeopardizes their health and safety is a REALLY bad idea. We have a long history in the West of not tolerating snake-oil salesmen.”
The complaint alleged that the defendants marketed several of their products as drugs through a series of disease-related treatment claims even though these same products had not received FDA approvals. The complaint further alleges that, despite repeated warnings from FDA, the defendants continued to post statements on their websites claiming that their products cured, mitigated, treated, or prevented a number of serious diseases. According to the complaint, these claims were unsupported by any well-controlled clinical studies or other credible scientific substantiation. In addition, the complaint alleges that the defendants’ products did not contain adequate directions for such uses. The complaint continued that directions for use, including dosages, warnings, and side effects, must be premised on clinical data derived from scientifically controlled investigation, and since the defendants persisted in making disease-related treatment claims about their products in the absence of any well-controlled scientific test data, the products were misbranded.
In addition to claims related to sales of unapproved drugs, the complaint further alleges that the defendants’ products were adulterated dietary supplements because they were not manufactured in compliance with federal good manufacturing practice regulations. Under the FDCA, dietary supplement manufacturers are required to have systems in place to ensure that their products meet specifications for identity, purity, strength and composition. According to the complaint, a 2016 FDA inspection of the defendants’ manufacturing facility revealed, among other things, that the defendants failed to establish specifications for the identity, purity, strength, and composition of their finished products or the components in their products, or prepare and follow their manufacturing plans. The complaint also alleges that many of the labels on the defendants’ supplements were deficient, and caused the products to be misbranded under the FDCA. The complaint alleges, for example, that some of the defendants’ supplement labels did not list all of the products’ ingredients, indicate the correct serving size, or indicate the number of servings in a bottle.
The defendants agreed to settle the litigation and be bound by a consent decree of permanent injunction. The consent decree requires that if the defendants wish to resume manufacturing drugs or dietary supplements in the future, they must implement the remedial measures set forth in the consent decree, notify the FDA of the measures they have taken, and obtain written approval from the FDA that they appear to be in compliance with both the terms of the consent decree and the provisions of the FDCA.
This matter was handled by Trial Attorney Christopher O’Connell of the Civil Division’s Consumer Protection Branch, with the assistance of Assistant U.S. Attorney Jacob Licht-Steenfat of the U.S. Attorney’s Office for the District of Colorado and Senior Counsel Michele Svonkin of the U.S. Department of Health and Human Services’ Office of General Counsel.
For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at https://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the District of Colorado, visit its website at https://www.justice.gov/usao-co.
District Court Enters Permanent Injunction Against Colorado Companies to Stop Distribution of Adulterated and Misbranded Dietary Supplements and Unapproved and Misbranded DrugsRead the Press Release
The U.S. District Court for the District of Colorado has entered a permanent injunction against EonNutra LLC, two related companies, CDSM LLC and HABW LLC, and their owner, Michael Floren, to prevent the sale and distribution of adulterated and misbranded dietary supplements and unapproved and misbranded drugs, the Justice Department announced today.
The Department filed a complaint on March 10 in the U.S. District Court for the District of Colorado, alleging that the defendants, who sell some 150 dietary supplement products, violated the Federal Food, Drug, and Cosmetic Act (FDCA). Although labelled as dietary supplements, several of the defendants’ products were, according to the complaint, marketed as drugs, with claims that the products could help treat or prevent a host of serious conditions or diseases, including heart disease, diabetes, depression, hypertension, osteoporosis, and liver and kidney disorders. But, according to the complaint, the defendants offered these claims to the consuming public, notwithstanding the absence of FDA approval. Some of the specific products identified in the complaint as unapproved drugs were 4NOx2, HGH Night Time, rHGH Drops Black Label, Primal Rage Levo 5 GH Mass and Deer Antler Velvet Extract. Additionally, as the complaint alleges, the defendants sold these supplements without implementing the requisite procedures to validate the supplements’ composition.
“The Department of Justice will continue to work cooperatively with FDA so that consumers can be confident in the claims of sellers of drugs and dietary supplements,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “Manufacturers need to ensure the quality and identity of the ingredients that go into their products, so that such products are safe for consumers and the public can rely on the integrity of those products.”
The complaint alleged that the defendants marketed several of their products as drugs through a series of disease-related treatment claims even though these same products had not received FDA approvals. The complaint further alleges that, despite repeated warnings from FDA, the defendants continued to post statements on their websites claiming that their products cured, mitigated, treated, or prevented a number of serious diseases. According to the complaint, these claims were unsupported by any well-controlled clinical studies or other credible scientific substantiation. In addition, the complaint alleges that the defendants’ products did not contain adequate directions for such uses. The complaint continued that directions for use, including dosages, warnings, and side effects, must be premised on clinical data derived from scientifically controlled investigation, and since the defendants persisted in making disease-related treatment claims about their products in the absence of any well-controlled scientific test data, the products were misbranded.
In addition to claims related to sales of unapproved drugs, the complaint further alleges that the defendants’ products were adulterated dietary supplements because they were not manufactured in compliance with federal good manufacturing practice regulations. Under the FDCA, dietary supplement manufacturers are required to have systems in place to ensure that their products meet specifications for identity, purity, strength and composition. According to the complaint, a 2016 FDA inspection of the defendants’ manufacturing facility revealed, among other things, that the defendants failed to establish specifications for the identity, purity, strength, and composition of their finished products or the components in their products, or prepare and follow their manufacturing plans. The complaint also alleges that many of the labels on the defendants’ supplements were deficient, and caused the products to be misbranded under the FDCA. The complaint alleges, for example, that some of the defendants’ supplement labels did not list all of the products’ ingredients, indicate the correct serving size, or indicate the number of servings in a bottle.
The defendants agreed to settle the litigation and be bound by a consent decree of permanent injunction. The consent decree requires that if the defendants wish to resume manufacturing drugs or dietary supplements in the future, they must implement the remedial measures set forth in the consent decree, notify the FDA of the measures they have taken, and obtain written approval from the FDA that they appear to be in compliance with both the terms of the consent decree and the provisions of the FDCA.
“Lying to the public so you can make money is a bad idea,” said Acting U.S. Attorney for the District of Colorado Bob Troyer. “Doing it in a way that jeopardizes their health and safety is a REALLY bad idea. We have a long history in the West of not tolerating snake-oil salesmen.”
This matter was handled by Trial Attorney Christopher O’Connell of the Civil Division’s Consumer Protection Branch, with the assistance of Assistant U.S. Attorney Jacob Licht-Steenfat of the U.S. Attorney’s Office for the District of Colorado and Senior Counsel Michele Svonkin of the U.S. Department of Health and Human Services’ Office of General Counsel.
For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at https://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the District of Colorado, visit its website at https://www.justice.gov/usao-co.
Dallas Man Sentenced to 240 Months for His Role in a Methamphetamine Distribution ConspiracyRead the Press Release
DALLAS — Josue Tijerina, aka “J,” 30, of Dallas, was sentenced yesterday before U.S. District Judge Barbara M.G. Lynn for his role in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.
Tijerina was sentenced to 240 months in federal prison. Tijerian pleaded guilty in August 2016 to one count of distribution of a controlled substance.
Tijerina and 18 co-defendants were charged in a 12-count indictment charging each defendant with one count of conspiracy to possess with intent to distribute 500 grams or more of methamphetamine. All but three of the defendants are also charged with one substantive count of either distribution of methamphetamine or possession with intent to distribute methamphetamine. Two defendants are charged with a firearms offense.
The investigation into this drug trafficking organization, which operated out of the Pleasant Grove, Seagoville and Balch Springs areas of the DFW metroplex, began in early January 2016. During the investigation, law enforcement has seized more than 6700 grams of methamphetamine, approximately 13.2 kilograms of methamphetamine oil, 62 grams of marijuana, 2.5 grams of heroin, and 20 ml of gamma hydroxybutyrate (GHB), as well as 12 firearms and $12,379 in cash.
The Department of Public Safety and the Dallas Police Department investigated. Assistant U.S. Attorney Andrew Wirmani prosecuted.
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Canton man indicted for trafficking crack cocaineRead the Press Release
A Canton man was indicted on crack cocaine trafficking charges, said David A. Sierleja, Acting U.S. Attorney for the Northern District of Ohio.
Jamel A. Smith, 45, was indicted on five counts of possession with the intent to distribute and distribution of crack cocaine.
Smith sold crack cocaine on five separate occasions in the Canton area. In total, Smith sold approximately seventy grams of crack cocaine, according to the indictment.
The case is being prosecuted by Assistant United States Attorney Aaron P. Howell following an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Canton Police Department.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the United States of America’s burden to prove each defendant’s guilt beyond a reasonable doubt.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendants’ prior criminal record, if any, the defendants’ roles in the offense and the characteristics of the violations.
Buffalo Woman Sentenced for Conspiracy to Distribute HeroinRead 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 Jeannette Knightner, 35, of Buffalo, NY, who was convicted of conspiracy to possess with intent to distribute; and to distribute; heroin within 1,000 feet of public housing authority property, was sentenced to time served by Senior U.S. District Judge William M. Skretny.
Assistant U.S. Attorney George C. Burgasser, who handled the case, stated that in June of 2014, the defendant agreed with Reginald Royal, Sr. to store heroin at a residence at 31 Olcott Lower in Lackawanna. On June 11, 2014, Reginald Royal, Sr. sold $100 worth of heroin to a confidential informant at Royal, Sr.’s residence at 1 Olin Lane which is part of the Baker Homes Public Housing Projects, a public housing facility owned by the Lackawanna Municipal Housing Authority. The heroin Royal sold to the confidential informant was retrieved from the defendant’s residence.
In addition, at the request of co-defendant Royal, Sr., on June 17, 2014, the defendant drove to Columbus, Ohio with another individual and purchased 23.5 grams of heroin for $2,200 that Royal, Sr. had provided to her. On June 18, 2014, as Knightner was driving back to New York, she and another individual were pulled over by the Erie County Sheriff’s Office near Angola, NY and the heroin was discovered in the defendant’s purse.
For his role, Reginald Royal, Sr. has been convicted and is scheduled to be sentenced on April 12, 2017.
Today’s sentencing is the result of an investigation by Special Agents of the Federal Bureau of Investigation, under the direction of Adam S. Cohen, Special Agent-in-Charge; the Lackawanna Police Department, under the direction of Chief James Michel; and the Erie County Sheriff’s Office, under the direction of Timothy Howard.
Boston Woman Sentenced for Conspiracy to Sell Weapons Stolen from U.S. Army Facility in WorcesterRead the Press Release
BOSTON – A Boston woman was sentenced today in U.S. District Court in Worcester in connection with the sale of machine guns and handguns stolen from the U.S. Army Reserve Center in Worcester.
Ashley Bigsbee, 27, of Dorchester, was sentenced by U.S. District Court Judge Timothy S. Hillman to 21 months in prison and 36 months of supervised release. In January 2016, Bigsbee and two co-defendants, Tyrone James and James Morales, were indicted for conspiracy to possess, store and sell stolen firearms; possession and sale of stolen firearms; and lying to federal agents. In December 2016, Bigsbee pleaded guilty to all charges.
On the night of Nov. 14, 2015, co-defendant James Morales allegedly broke into a weapons vault inside the Lincoln Stoddard United States Army Reserve Center in Worcester and stole six M-4 Carbines and ten M-11 handguns.
The following morning, Morales visited Bigsbee and James at their home in Dorchester and proposed that they assist him with selling a number of the weapons he had stolen and they agreed to do so.
Bigsbee and James then contacted numerous individuals via text message offering to sell the firearms for well below the market and street value. and James’s phones were later found to contain text messages evidencing these efforts along with photographs which depicted: the stolen weapons lying on the kitchen table of their Dorchester apartment; Bigsbee holding one of the stolen M-11 handguns; and two of the stolen M-11 handguns lying on their bed. Through their efforts, and James arranged for Morales to sell a number of the handguns, and conducted the sales in their apartment on Nov. 15, 2015. In exchange for their assistance with selling the stolen weapons, Morales gave James and one of the M-4 Carbines. On the night of Nov. 15, 2015, or soon after, and/or James put the weapon in a duffle bag and brought it to the home of an acquaintance on Kingsdale Street in Dorchester who agreed to store the duffle bag.
During an interview on Nov. 20, 2015, Bigsbee lied to federal agents concerning her knowledge of the sale of the firearms. Following her arrest on Nov. 27, 2015, Bigsbee arranged to contact the acquaintance from Kingsdale Street asking him to leave the duffle bag outside on the sidewalk for police. Bigsbee then directed agents to Kingsdale Street, where the final M-4 Carbine was recovered from a duffle bag on the sidewalk. The M-4 Carbine is a military weapon capable of firing a three bullet “burst” for each single pull of the trigger, which classifies it as a machine gun under federal law.
During the sentencing hearing, the government argued that Bigsbee, while a person with a limited criminal record who had not previously been incarcerated, deserved a significant prison sentence in light of her efforts to assist with sale of the stolen firearms, including the machineguns.
Co-defendant Tyrone James is scheduled to be sentenced on March 24, 2017 and James Morales is scheduled for trial on April 10, 2017.
Acting United States Attorney William D. Weinreb; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Mickey D. Leadingham, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Boston Field Division; Matthew Etre, Special Agent in Charge of Homeland Security Investigations in Boston; Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police; Worcester Police Chief Steven M. Sargent; Boston Police Commissioner William Evans; Suffolk County Sheriff Steven W. Tompkins; and Cambridge Police Commissioner Brent Larrabee, made the announcement today. Assistant U.S. Attorney Mark Grady of Weinreb’s Worcester Branch Office prosecuted the case.
The charges against Morales are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in the court of law.
Blue Springs Man Sentenced for Illegal Drugs, FirearmsRead the Press Release
KANSAS CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced that a Blue Springs, Mo., man who was caught three times in the same month with illegal drugs and guns, was sentenced in federal court today.
Damion Cornish, 39, of Blue Springs, was sentenced by U.S. District Judge Dean Whipple to 10 years in federal prison without parole.
On Oct. 17, 2016, Cornish pleaded guilty to possessing methamphetamine with the intent to distribute and to possessing a firearm in furtherance of a drug-trafficking crime.
Cornish was arrested in connection with a domestic disturbance at his residence on May 10, 2016. Blue Springs police officers seized from the residence heroin (24 grams); cocaine (27 grams); methamphetamine (178 grams); marijuana (51 grams) and an assortment of illegal pills. In addition, the police seized an Interarms Firestar .40-caliber semi-automatic pistol from the residence.
On May 19, 2016, Independence police officers conducted a car stop of Cornish’s vehicle and seized heroin (17.99 grams); cocaine (17.73 grams); crack cocaine (.65 grams); methamphetamine (97.5 grams); marijuana (5.75 grams) and an assortment of illegal pills. In addition, officers seized a Glock .40-caliber semi-automatic pistol that Cornish was carrying.
Cornish was arrested on May 28, 2016, on federal charges. At the time of his arrest, Blue Springs police officers seized from his residence heroin (14 grams), cocaine (4 grams); methamphetamine (82 grams); and marijuana (439 grams). In addition, police officers seized a firearm and 60 rounds of ammunition belonging to Cornish.
This case was prosecuted by Assistant U.S. Attorney David Raskin. It was investigated by the Blue Springs, Mo., Police Department, the Independence, Mo., Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Bellevue Felon Charged with Illegally Possessing 3 FirearmsRead the Press Release
PITTSBURGH – An Allegheny County resident has been indicted by a federal grand jury in Pittsburgh on violations of the federal firearms laws, Acting United States Attorney Soo C. Song announced today.
The three-count indictment, returned on March 14, named Patrick Snyder, age 33, as the sole defendant.
According to the indictment, between December 2016 and January 2017, Snyder illegally possessed three different firearms. Snyder has previously been convicted of a felony and is prohibited by federal law from possessing a firearm.
The law provides for a maximum total sentence of up to ten (10) years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history of the defendant.
This case is being prosecuted under Project Safe Neighborhoods, a collaborative effort by federal, state and local law enforcement agencies, prosecutors and communities to prevent, deter and prosecute gun crime. The Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Bellevue Police Department conducted the investigation leading to the indictment in this case. Assistant United States Attorney Timothy Lanni is prosecuting this case on behalf of the government.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Bedford woman accused of embezzling $288,000 from her employerRead the Press Release
A federal grand jury returned an indictment charging Catherine I. Wilson, 62, of Bedford, with bank fraud after she embezzled nearly $300,000 from her employer, said David A. Sierleja, Acting U.S. Attorney for the Northern District of Ohio.
Wilson was employed at Koppel Advertising in Bedford from 1991 through 2014. From 2011 through September 30, 2014, Wilson embezzled funds from Koppel’s business bank accounts by using company funds to pay her personal bills and expenses, according to the indictment.
In order to conceal her fraudulent conduct, Wilson altered Koppel’s bank statements to remove records relating to her unauthorized transactions. The total loss associated with this conduct is approximately $288,235, according to the indictment.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
This case is being prosecuted by Assistant U.S. Attorney Matthew B. Kall following an investigation by the United States Secret Service.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Armed Drug Trafficker Sentenced to 20 Years in Federal PrisonRead the Press Release
EUGENE, Ore. – On Monday, March 13, 2017, Greyson Scott Lindenfelser, 29, of Roseburg, Oregon, was sentenced by U.S. District Court Judge Michael J. McShane to 20 years in federal prison for being a felon in possession of a stolen firearm and distributing more than 600 grams of methamphetamine.
On September 16, 2014, Deputy U.S. Marshals, along with Lane and Douglas County Interagency Narcotics Enforcement Team (INET) detectives, arrested Lindenfelser at a motel in Creswell, Oregon. The marshals and detectives found $12,653 on Lindenfelser’s person and more than 600 grams of methamphetamine and a loaded .45 caliber pistol in his motel room.
According to court documents, Lindenfelser was previously arrested by Douglas County Sheriff Deputies in June of 2014 for delivering several pounds of methamphetamine and hydrocodone pills. After being released, warrants for his arrest were issued in July of 2014 for robbery, kidnapping and unlawful use of weapons. In August of 2014, after leading Benton County Sheriff Deputies on a high-speed chase, Lindenfelser crashed his vehicle and managed to avoid arrest, leaving behind two pounds of methamphetamine and a loaded .40 caliber pistol in the vehicle.
Lindenfelser has eight prior felony convictions including robbery and illegally possessing drugs and firearms. On January 6, 2017, Lindenfelser pleaded guilty in Douglas County Circuit Court to first-degree robbery and was sentenced to 7 ½ years in state prison. Lindenfelser will serve his state and federal prison sentences concurrently.
The case was investigated by the Drug Enforcement Administration (DEA), Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), U.S. Marshals Service, and the Douglas, Lane, and Benton County Sheriff’s Offices. It was prosecuted by Frank R. Papagni, Jr., Assistant United States Attorney for the District of Oregon with assistance from Benton County District Attorney John M. Haroldson and Douglas County District Attorney Rick Wesenberg.
Albany Gun Dealer Indicted on Federal Firearms ChargesRead the Press Release
EUGENE, Ore. – On Wednesday, March 15, 2017, the United States Attorney’s Office for the District of Oregon announced that a federal grand jury in Eugene has indicted Nicholas Earle Russell, 67, of Albany, Oregon. Russell is the owner and operator of a gun store called Albany Guns, Coins and Jewelry.
The four-count indictment alleges that from November 19, 2016 to January 25, 2017, Russell sold high-caliber firearms, including a .50 caliber handgun and .223 and .308 caliber rifles, to an individual Russell knew was a convicted felon. Each charge carries a maximum term of imprisonment of ten years and a fine of up to $250,000.
An indictment is only an accusation of a crime, and a defendant should be presumed innocent unless and until proven guilty.
This case was investigated by the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and is being prosecuted by Nathan J. Lichvarcik, Assistant United States Attorney for the District of Oregon.
Akron man indicted on firearms and counterfeiting chargesRead the Press Release
An Akron man was indicted on firearms and counterfeiting charges, said Acting U.S. Attorney David A. Sierleja.
Abraham Lewis Addison, 27, was indicted on five counts of uttering and dealing in counterfeit obligations or securities and one count of possession of a firearm with an obliterated serial number.
Addison on Sept. 9, 2016 had had approximately $2,450 in counterfeit currency in the form of fake $50 and $20 bills. HE also had a Ruger 9mm semiautomatic pistol with an obliterated serial number, according to the indictment.
This case was investigated by the Summit County Sheriff’s Office, Akron Police Department, Ohio Highway Patrol, Bath Police Department and the United States Secret Service. It is being prosecuted by Assistant U.S. Attorney Teresa Riley.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
49 Members and Associates of Two Bronx Drug Distribution Organizations Charged in Federal Court with Narcotics, Robbery, and Firearms OffensesRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, Darcel D. Clark, the Bronx County District Attorney, James O’Neill, the Commissioner of the New York City Police Department (“NYPD”), Angel M. Melendez, Special Agent-in-Charge of the New York Field Office of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (“HSI”), and James J. Hunt, Special Agent-in-Charge of the New York Field Division of the Drug Enforcement Administration (“DEA”), today announced the unsealing of two Indictments charging 49 members of two Bronx-based drug distribution organizations, with various narcotics, robbery, and firearms offenses, including the murder of Jose Morales on December 11, 2016.
Fifteen defendants associated with a drug distribution organization operating primarily on East 175th Street and Monroe Avenue in the Bronx are charged in United States v. James Felton, et al., which has been assigned to U.S. District Judge William H. Pauley. The defendants taken into federal custody today were presented before Magistrate Judges Barbara C. Moses and Henry B. Pitman. Three defendants, JAMES FELTON, JAMES DIAZ, and ANDRE FELTON, are currently incarcerated in federal custody on related charges and will be arraigned on the Indictment before Judge Pauley on March 23, 2017.
Thirty-four defendants associated with a drug distribution organization operating primarily on Weeks Avenue and East 176th Street in the Bronx are charged in United States v. Edwin Romero, et al., which has been assigned to U.S. District Judge Loretta A. Preska. The defendants taken into federal custody today were presented before Magistrate Judges Barbara C. Moses and Henry B. Pitman.
Manhattan Acting U.S. Attorney Joon H. Kim said: “Dozens of alleged members of two drug distribution organizations have been charged with peddling potentially lethal drugs. Many are also charged with committing violent crimes, including four who allegedly murdered Jose Morales in furtherance of their drug business. All New Yorkers are entitled to the peaceful enjoyment of their homes, free from the devastating effects of drugs and the violence that can accompany drug trafficking. Together with our law enforcement partners, we will continue to work to return the neighborhoods of the Bronx to the law-abiding people who live in them.”
Bronx District Attorney Darcel D. Clark said: “This case crystallizes how drug dealing’s attendant violence devastates our neighborhoods. These two organizations held the Mount Hope area in a vise grip of numerous street shootings, including at least one murder. In our fight against heroin and other drugs, we must always remain focused on the community residents who are victimized by these vicious traffickers.”
Police Commissioner James P. O’Neill said: “Today’s arrests are the latest example of drug dealing that led to violence, including armed robberies and a murder in the Bronx, as alleged. This type of precision policing is leading to further reductions in crime beyond last year’s all-time low. Many thanks to the detectives, agents, and the prosecutors in the Southern District we so often work with and whose diligence resulted in the leveling of these serious drug trafficking charges today.”
HSI Special Agent-in-Charge Angel M. Melendez said: “Today the law enforcement community in New York struck a serious blow to violent drug distribution organizations that operate in our city. Two such organizations allegedly flooded the community of Mount Hope in the Bronx with heroin, crack cocaine, fear and death. This is yet another step in our efforts to bring peace and hope to our communities by removing the alleged leadership and rank-and-file members of these organizations, putting an end to their menacing criminal conduct.”
DEA Special Agent in Charge of the New York Field Division James J. Hunt said: “Guns, violence and turf wars plague neighborhoods that drug dealers have turned into battlefields. Today, law enforcement has reclaimed the Mount Hope section of the Bronx by arresting dozens of alleged members of two drug trafficking organizations. DEA Agents working with HSI, NYPD, the Bronx District Attorney’s Office and the SDNY U.S. Attorney’s Office identified and dismantled these crews allegedly responsible for fueling drug addiction and drug-related violence.”
The Indictments[1] arise from a joint investigation by HSI, the DEA, and the NYPD into two violent drug trafficking organizations that operated in the 46th Precinct in the Bronx. Members of these drug trafficking organizations sold crack cocaine, cocaine, heroin, and marijuana, and they possessed and used firearms to further their drug trafficking activities.
Count One of the Indictment in U.S. v. James Felton, et al., unsealed today in Manhattan federal court, charges JAMES FELTON, JAMES DIAZ, ANDRE FELTON, EZEKIEL BURLEY, URIAH BROWN, BRADFORD CANNON, WILLIE REEVES, HAROLD FIELDS, ROBERT BRENT, DASHAUN MCDONALD, MATTHEW TORRES, TYRONE TURNER, KENDRICK MCCRAY, GINGER DIAZ, and JOSE SANDOVAL with conspiring to distribute and possess with intent to distribute crack cocaine, cocaine, heroin, and marijuana.
Counts Two charges JAMES FELTON, DIAZ, ANDRE FELTON, and BURLEY with the murder of Jose Morales, which occurred on December 11, 2016, in the vicinity of East 175th Street and Weeks Avenue, in the course of a narcotics conspiracy.
Count Three charges JAMES FELTON, DIAZ, ANDRE FELTON, and BURLEY with using, carrying, possessing, brandishing, and discharging a firearm during and in relation to a narcotics conspiracy, resulting in the death of Jose Morales on December 11, 2016.
Count Four charges JAMES FELTON, DIAZ, and BURLEY with using, carrying, possessing, brandishing, and discharging a firearm during and in relation to a narcotics conspiracy, on dates other than December 11, 2016.
Count Five charges BROWN, CANNON, REEVES, FIELDS, BRENT, MCDONALD, TORRES, TURNER, MCCRAY, DIAZ, and SANDOVAL with using, carrying, possessing, brandishing, and discharging firearms during and in relation to a narcotics conspiracy.
Count One of the Indictment in U.S. v. Edwin Romero, et al., unsealed today in Manhattan federal court, charges EDWIN ROMERO, RAFAEL ROMERO, FRANCIS PALUZZI, LUIS GONZALEZ, ANIBAL GONZALEZ, CARLOS MOTA, ELIMANUEL DIAZ, PEDRO OLIVO, ADRIAN SANCHEZ, DARYL SIMON, JEFFREY FERNANDEZ, JUAN VALDEZ, WILLIE TUCKER, KASAN NOBLE, DAMIAN SAUNDERS, DANIEL JEFFERSON, DERECK JEFFERSON, WAYNE SCOTT, ERIC RIVERA, MICHAEL MARTINEZ, MAXAMILLION MERCADO, KAREEM SIMMONDS, ALEXANDER PENA, ANTHONY CLASE, CARLOS ACOSTA, CHRISTOPHER RODRIGUEZ, GABRIEL GONZALEZ, JESUS MATA, NANA OWUSU, ROBERTO RAMIREZ, WILPHER RODRIGUEZ, YAWILIS RODRIGUEZ, JESUS ABAD, and ANGEL GUANCE with conspiring to distribute and possess with intent to distribute crack cocaine, cocaine, heroin, and marijuana.
Count Two charges EDWIN ROMERO, SANCHEZ, VALDEZ, TUCKER, and YAWILIS RODRIGUEZ with conspiring to commit robbery.
Count Three charges EDWIN ROMERO, RAFAEL ROMERO, FRANCIS PALUZZI, LUIS GONZALEZ, ANIBAL GONZALEZ, CARLOS MOTA, ELIMANUEL DIAZ, PEDRO OLIVO, ADRIAN SANCHEZ, DARYL SIMON, JEFFREY FERNANDEZ, JUAN VALDEZ, WILLIE TUCKER, KASAN NOBLE, DAMIAN SAUNDERS, DANIEL JEFFERSON, DERECK JEFFERSON, WAYNE SCOTT, ERIC RIVERA, MICHAEL MARTINEZ, KAREEM SIMMONDS, ALEXANDER PENA, ANTHONY CLASE, CARLOS ACOSTA, CHRISTOPHER RODRIGUEZ, GABRIEL GONZALEZ, JESUS MATA, NANA OWUSU, ROBERTO RAMIREZ, WILPHER RODRIGUEZ, YAWILIS RODRIGUEZ, JESUS ABAD, and ANGEL GUANCE with using, carrying, possessing, brandishing, and discharging a firearm during and in relation to a narcotics conspiracy.
Count Four charges EDWIN ROMERO with using, carrying, possessing, brandishing, and discharging a firearm during and in relation to a crime of violence.
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Charts containing the names, ages, residences, charges, and maximum penalties for the defendants are set forth below. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the respective judges.
Mr. Kim praised the outstanding investigative work of the NYPD, HSI, and DEA, and expressed gratitude for the coordinated efforts of the NYPD’s Detective Bureau, including the Bronx Violent Crime Squad, the 46th Precinct Detectives Squad, and the Bronx Homicide Task Force. Mr. Kim also expressed gratitude to the Bronx District Attorney’s Office for its partnership in this investigation.
This case is being handled by the Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Frank Balsamello, Matthew Laroche, Anden Chow, and Michael Krouse, and Special Assistant United States Attorney Matthew Hellman (cross-designated from the Bronx District Attorney’s Office) are in charge of the prosecution.
The charges contained in the Indictments are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
United States v. James Felton, et al., S2 17 Cr. 21 (WHP)
COUNT
CHARGE
DEFENDANTS
MAX. PENALTIES
1
Narcotics conspiracy
21 U.S.C. § 846
JAMES FELTON
JAMES DIAZ
ANDRE FELTON
EZEKIEL BURLEY
URIAH BROWN
BRADFORD CANNON
WILLIE REEVES
HAROLD FIELDS
ROBERT BRENT
DASHAUN MCDONALD
MATTHEW TORRES
TYRONE TURNER
KENDRICK MCCRAY
GINGER DIAZ
JOSE SANDOVAL
Life in prison
Mandatory minimum of 10 years in prison
2
Murder while engaged in a narcotics conspiracy
21 U.S.C. § 848(e)(1)(A); 18 U.S.C. § 2
JAMES FELTON
JAMES DIAZ
ANDRE FELTON
EZEKIEL BURLEY
Life in prison or death
Mandatory minimum of 20 years in prison
3
Using, carrying, possessing, brandishing, and discharging firearms, causing death
18 U.S.C. §§ 924(j)(1) and 2
JAMES FELTON
JAMES DIAZ
ANDRE FELTON
EZEKIEL BURLEY
Life in prison or death
4
Using, carrying, possessing, brandishing, and discharging firearms
18 U.S.C.
§§ 924(c)(1)(A)(i), (ii), (iii), 924(c)(1)(C)(i), and 2JAMES FELTON
JAMES DIAZ
EZEKIEL BURLEY
Life in prison
Mandatory minimum of 10 years in prison for DIAZ and BURLEY
Mandatory minimum of 25 years in prison for JAMES FELTON
5
Using, carrying, possessing, brandishing, and discharging firearms
18 U.S.C.
§§ 924(c)(1)(A)(i), (ii), and (iii), 2URIAH BROWN
BRADFORD CANNON
WILLIE REEVES
HAROLD FIELDS
ROBERT BRENT
DASHAUN MCDONALD
MATTHEW TORRES
TYRONE TURNER
KENDRICK MCCRAY
GINGER DIAZ
JOSE SANDOVAL
Life in prison
Mandatory minimum of 10 years in prison
DEFENDANT
AGE
RESIDENCE
JAMES FELTON
47
Bronx, New York
JAMES DIAZ,
a/k/a “Chunky”
24
Bronx, New York
ANDRE FELTON,
a/k/a “Dre”
39
Mount Vernon, New York
EZEKIEL BURLEY,
a/k/a “Ezekiel McCall”
a/k/a “Zeke”
a/k/a “Ziggy”
23
Bronx, New York
URIAH BROWN,
a/k/a “Scooter”
42
Bronx, New York
BRADFORD CANNON,
a/k/a “Brad”
46
Bronx, New York
WILLIE REEVES,
a/k/a “Willie Reed”
a/k/a “Willow”
30
Bronx, New York
HAROLD FIELDS,
a/k/a “Howie”
a/k/a “HD”
38
Bronx, New York
ROBERT BRENT,
a/k/a “Ready”
45
Brooklyn, New York
DASHAUN MCDONALD,
a/k/a “Dayday”
27
Bronx, New York
MATTHEW TORRES,
a/k/a “Mac Mittens”
a/k/a “Green Eyes”
33
Bronx, New York
TYRONE TURNER,
a/k/a “Skrap”
32
Bronx, New York
KENDRICK MCCRAY,
a/k/a “Kenny”
43
Bronx, New York
GINGER DIAZ,
a/k/a “George”
30
Bronx, New York
JOSE SANDOVAL,
a/k/a “Shorty”
41
Bronx, New York
United States v. Edwin Romero, et al., S1 17 Cr. 123 (LAP)
COUNT
CHARGE
DEFENDANTS
MAX. PENALTIES
1
Narcotics conspiracy
21 U.S.C. § 846
EDWIN ROMERO
RAFAEL ROMERO
FRANCIS PALUZZI
LUIS GONZALEZ
ANIBAL GONZALEZ
CARLOS MOTA
ELIMANUEL DIAZ
PEDRO OLIVO
ADRIAN SANCHEZ
DARYL SIMON
JEFFREY FERNANDEZ
JUAN VALDEZ
WILLIE TUCKER
KASAN NOBLE
DAMIAN SAUNDERS
DANIEL JEFFERSON
DERECK JEFFERSON
WAYNE SCOTT
ERIC RIVERA
MICHAEL MARTINEZ
MAXAMILLION MERCADO
KAREEM SIMMONDS
ALEXANDER PENA
ANTHONY CLASE
CARLOS ACOSTA
CHRISTOPHER RODRIGUEZ
GABRIEL GONZALEZ
JESUS MATA
NANA OWUSU
ROBERTO RAMIREZ
WILPHER RODRIGUEZ
YAWILIS RODRIGUEZ
JESUS ABAD
ANGEL GUANCE
Life in prison
Mandatory minimum of 10 years in prison
2
Robbery conspiracy
18 U.S.C. § 1951
EDWIN ROMERO
ADRIAN SANCHEZ
JUAN VALDEZ
WILLIE TUCKER
YAWILIS RODRIGUEZ
20 years in prison
3
Using, carrying, possessing, brandishing, and discharging firearms
18 U.S.C.
§§ 924(c)(1)(A)(i), (ii), and (iii), 2EDWIN ROMERO
RAFAEL ROMERO
FRANCIS PALUZZI
LUIS GONZALEZ
ANIBAL GONZALEZ
CARLOS MOTA
ELIMANUEL DIAZ
PEDRO OLIVO
ADRIAN SANCHEZ
DARYL SIMON
JEFFREY FERNANDEZ
JUAN VALDEZ
WILLIE TUCKER
KASAN NOBLE
DAMIAN SAUNDERS
DANIEL JEFFERSON
DERECK JEFFERSON
WAYNE SCOTT
ERIC RIVERA
MICHAEL MARTINEZ
KAREEM SIMMONDS
ALEXANDER PENA
ANTHONY CLASE
CARLOS ACOSTA
CHRISTOPHER RODRIGUEZ
GABRIEL GONZALEZ
JESUS MATA
NANA OWUSU
ROBERTO RAMIREZ
WILPHER RODRIGUEZ
YAWILIS RODRIGUEZ
JESUS ABAD
ANGEL GUANCE
Life in prison
Mandatory minimum of 10 years in prison
4
Using, carrying, possessing, brandishing, and discharging firearms
18 U.S.C.
§§ 924(c)(1)(A)(i), (ii), (iii), 924(c)(1)(C)(i), and 2EDWIN ROMERO
Life in prison
Mandatory minimum of 25 years in prison
DEFENDANT
AGE
RESIDENCE
EDWIN ROMERO,
a/k/a “Yones”
a/k/a “Yoni”
35
Bronx, New York
RAFAEL ROMERO,
a/k/a “Kodi”
34
Bronx, New York
FRANCIS PALUZZI,
a/k/a “Fetty”
27
Bronx, New York
LUIS GONZALEZ,
a/k/a “Tili”
a/k/a “Bori”
39
Bronx, New York
ANIBAL GONZALEZ,
a/k/a “Foli”
34
Bronx, New York
CARLOS MOTA,
a/k/a “Culebra”
a/k/a “Snake”
47
Bronx, New York
ELIMANUEL DIAZ,
a/k/a “Lima”
27
Bronx, New York
PEDRO OLIVO,
a/k/a “Pito”
24
Bronx, New York
ADRIAN SANCHEZ,
a/k/a “Pachi”
23
Bronx, New York
DARYL SIMON,
a/k/a “D-Money”
19
Bronx, New York
JEFFREY FERNANDEZ,
a/k/a “Jefe”
19
Bronx, New York
JUAN VALDEZ,
a/k/a “Sito”
21
Bronx, New York
WILLIE TUCKER,
a/k/a “Big Will”
a/k/a “BJ”
a/k/a “BG”
38
Bronx, New York
KASAN NOBLE,
a/k/a “Kay Kay”
40
Bronx, New York
DAMIAN SAUNDERS,
a/k/a “Floss”
37
Bronx, New York
DANIEL JEFFERSON,
a/k/a “Ace”
30
Bronx, New York
DERECK JEFFERSON,
a/k/a “Bang”
28
Bronx, New York
WAYNE SCOTT,
a/k/a “Punch”
37
Bronx, New York
ERIC RIVERA,
a/k/a “Chucky”
a/k/a “Chuck Dollarz”
24
Bronx, New York
MICHAEL MARTINEZ
26
Bronx, New York
MAXAMILLION MERCADO,
a/k/a “Bully”
24
Bronx, New York
KAREEM SIMMONDS,
a/k/a “Kareem Simmons”
a/k/a “Black”
40
Bronx, New York
ALEXANDER PENA,
a/k/a “Green Eyes”
20
Bronx, New York
ANTHONY CLASE,
a/k/a “Ant”
30
Bronx, New York
CARLOS ACOSTA,
a/k/a “Greg”
23
Bronx, New York
CHRISTOPHER RODRIGUEZ,
a/k/a “Dread”
21
Bronx, New York
GABRIEL GONZALEZ,
a/k/a “Gabi”
a/k/a “Baldy”
40
Bronx, New York
JESUS MATA,
a/k/a “Junior”
a/k/a “Jay”
20
Bronx, New York
NANA OWUSU,
a/k/a “Africa”
19
Bronx, New York
ROBERTO RAMIREZ
29
Bronx, New York
WILPHER RODRIGUEZ
23
Bronx, New York
YAWILIS RODRIGUEZ,
a/k/a “Will”
22
Bronx, New York
JESUS ABAD,
a/k/a “Rojo”
26
Bronx, New York
ANGEL GUANCE,
a/k/a “Chico”
a/k/a “All In”
27
Bronx, New York
[1] As the introductory phrase signifies, the entirety of the text of the Indictments, and the description of the Indictments set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
14 March 2017
Women Sentenced for Social Security FraudRead the Press Release
FORT WAYNE – The Acting United States Attorney for the Northern District of Indiana, Clifford D. Johnson, announces that Elizabeth Heckathorne, 39, of Garrett, Indiana was sentenced before District Court Judge Theresa Springmann following her plea of guilty to a single count of social security fraud.
Heckathorne was sentenced to 15 months imprisonment and ordered to pay $71,410 in restitution to the Social Security Administration.
This investigation was conducted by the Social Security Administration, Office of Inspector General. This case was prosecuted by Assistant United States Attorney Lovita Morris King.
# # #
Woman Admits to Causing the Death of another Person by Injecting her with Liquid SiliconeRead the Press Release
ATLANTA - Deanna Roberts has pleaded guilty to four felony counts of possessing, transporting, and ultimately illegally injecting persons with liquid silicone and four felony counts of introducing into interstate commerce liquid silicone, which was an adulterated device. One of the women the defendant injected with liquid silicone died about 36 hours after receiving the injection when the silicone migrated to her lungs, heart, brain, and other organs.
“Roberts admitted that she caused the death of one person by injecting her with liquid silicone, and that she also injected liquid silicone into multiple other people, putting their lives at considerable risk,” said U. S. Attorney John Horn. “Before undergoing any type of medical procedure, patients should ensure they have consulted a licensed medical provider who is qualified to provide care.”
“Liquid silicone injected into individuals’ bodies can cause serious bodily injury and death, and FDA has not approved any such product for tissue augmentation,” said Justin D. Green, Special Agent in Charge, FDA Office of Criminal Investigations’ Miami Field Office. “We remain fully committed to bringing to justice those who offer dangerous and unapproved products to American consumers.”
According to U.S. Attorney Horn, the indictment, and other information presented in court: Between April 2004 and December 2015, Roberts purchased at least 178 gallons of liquid silicone. Liquid silicone is strictly regulated by the FDA, and may be legally injected directly into the human body only as a treatment for certain eye conditions.
In April 2004, Roberts began ordering liquid silicone from a business in Arizona. In order to purchase liquid silicone from the business, Roberts submitted an affidavit to the company in which she falsely swore that she did not intend to inject the silicone into humans. Rather she claimed that she intended to supply the silicone to a customer for use in lubricating medical equipment.
On multiple occasions, Roberts transported liquid silicone to the Atlanta area and injected it into the hips, buttocks, and other body parts of her victims. Roberts falsely claimed to her victims that she was a licensed medical practitioner.
During the evening of November 16, 2015, Roberts injected liquid silicone into the buttocks of victim L.H. The next day L.H. complained of tightness in her chest and shortness of breath, symptoms that are consistent with the presence of liquid silicone in the lungs. During the early morning hours of November 18, 2015, L.H., died.Dr. Geoffrey Smith, Associate Medical Examiner for DeKalb County, performed an autopsy on L.H. Based upon the autopsy Dr. Smith determined that L.H. died from complications due to silicone polymer embolization. Dr. Smith found that L.H.’s lungs were heavily congested with liquid silicone. In addition, Dr. Smith found liquid silicone in L.H.’s liver, kidney, heart, brain, and spleen. Dr. Smith noted that each of L.H.’s buttocks had 10 injection sites.
From a microscopic examination of tissue surrounding one of the injection sites Dr. Smith determined that a blood vessel had been punctured. The evidence, therefore, established that the defendant punctured the blood vessel with one of the silicone injections and that the silicone was carried by the blood stream to L.H.’s lungs and other organs causing her death.
Additionally:
-
On November 16, 2015, the defendant illegally injected liquid silicone into the buttocks of victim J.T.
-
In November of 2014, the defendant injected liquid silicone into the buttocks of victim V.M.
- In October of 2014, the defendant injected liquid silicone into the face of victim S.P.
However, J.T., V.M., and S.P. did not die from their injections.
Sentencing for Deanna Roberts, 47, of Sanford, Florida, is scheduled for May 24, 2017, at 2:00 p.m., before U.S. District Judge Orinda D. Evans.
This case is being investigated by the Food and Drug Administration, Office of Criminal Investigations, the Doraville Police Department, and the Atlanta Police Department.
Assistant United States Attorneys William L. McKinnon, Jr. and Erin Sanders are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
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W. Stephen Muldrow to Serve as Acting U.S. AttorneyRead the Press Release
Tampa, Florida – W. Stephen Muldrow has been named as the Acting United States Attorney for the Middle District of Florida. He assumed this post following the resignation of A. Lee Bentley, III on March 13, 2017.
From July 2013 to March 2017, Mr. Muldrow served as the First Assistant U.S. Attorney to United States Attorney A. Lee Bentley, III. Mr. Muldrow has been an Assistant U.S. Attorney in the Middle District of Florida since 2001, where he also served as an Organized Crime Drug Enforcement Task Force (OCDETF) prosecutor, a Senior Litigation Counsel, and Chief of the Major Crimes Section. Before that, he was an Assistant U.S. Attorney in the District of Puerto Rico from 1995 to 2001, where he served as that district’s Lead OCDETF Attorney and Coordinator for the High Intensity Drug Trafficking Area (HIDTA) Task Force. In 1989, Mr. Muldrow joined the Department of Justice through the Honors Program as a Trial Attorney in the Tax Division, Civil Trial Section, Northern Region (Washington, D.C.), where he remained until 1995. From 1988 to 1989, he worked as a Law Clerk for the United States Marshals Service, Office of Legal Counsel (Washington, D.C.). Mr. Muldrow earned his Bachelor of Arts degree in Economics with a minor in Spanish from Bucknell University (1986), his law degree with honors from The American University, Washington College of Law (1989), and a Master of Arts in Law & International Affairs, also from The American University (1989).
The Middle District of Florida serves 35 of the 67 counties in Florida, which is over half the population of Florida, from Jacksonville in the north, Orlando and Ocala in the center of the state, through Tampa on the west coast, and south to the Ft. Myers area. Headquartered in Tampa, five offices are located throughout the district.
U.S. Navy Admiral and Eight Other Officers Indicted for Trading Classified Information in Massive International Fraud and Bribery SchemeRead the Press Release
Retired U.S. Navy Rear Admiral Bruce Loveless and eight other high-ranking Navy officers are charged in a federal indictment with accepting luxury travel, elaborate dinners and services of prostitutes from foreign defense contractor Leonard Francis, the former Chief Executive Officer (CEO) of Glenn Defense Marine Asia (GDMA), in exchange for classified and internal U.S. Navy information.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Alana W. Robinson of the Southern District of California, Director Dermot F. O’Reilly of the Defense Criminal Investigative Service (DCIS) and Director Andrew L. Traver of the Naval Criminal Investigative Service (NCIS) made the announcement.
Including today’s defendants, a total of 25 named individuals have been charged in connection with the corruption and fraud investigation into GDMA, a defense-contracting firm based in Singapore. Of those charged, 20 are current or former U.S. Navy officials and five are GDMA executives. To date, 13 have pleaded guilty while several other cases are pending.
“The defendants in this indictment were entrusted with the honor and responsibility of administering the operations of the U.S. Navy’s Seventh Fleet, which is tasked with protecting our nation by guarding an area of responsibility that spanned from Russia to Southeast Asia and the Indian Ocean,” said Acting Assistant Attorney General Blanco. “With this honor and awesome responsibility came a duty to make decisions based on the best interests of the Navy and the 40,000 Sailors and Marines under their care who put their lives at risk every day to keep us secure and free. Unfortunately, however, these defendants are alleged to have sold their honor and responsibility in exchange for personal enrichment.”
“This is a fleecing and betrayal of the United States Navy in epic proportions, and it was allegedly carried out by the Navy’s highest-ranking officers,” said Acting U.S. Attorney Robinson. “The alleged conduct amounts to a staggering degree of corruption by the most prominent leaders of the Seventh Fleet – the largest fleet in the U.S. Navy - actively worked together as a team to trade secrets for sex, serving the interests of a greedy foreign defense contractor, and not those of their own country.”
“The allegations contained in today’s indictment expose flagrant corruption among several senior officers previously assigned to the U.S. Navy’s Seventh Fleet. The charges and subsequent arrests are yet another unfortunate example of those who place their own greed above their responsibility to serve this nation with honor,” said Director O’Reilly. “This investigation should serve as a warning sign to those who attempt to compromise the integrity of the Department of Defense that DCIS and our law enforcement partners will continue to pursue these matters relentlessly.”
“Naval Criminal Investigative Service, in concert with our partner agencies, remains resolved to follow the evidence wherever it leads, and to help hold accountable those who make personal gain a higher priority than professional responsibility,” Director Traver. “It's unconscionable that some individuals choose to enrich themselves at the expense of military security.”
Nine defendants were arrested today on various charges including bribery, conspiracy to commit bribery, honest services fraud, obstruction of justice and making false statements to federal investigators when confronted about their actions. Four of the defendants are retired captains: (1) David Newland, 60, of San Antonio, Texas, (2) James Dolan, 58, of Gettysburg, Pennsylvania, (3) David Lausman, 62, of The Villages, Florida, and (4) Donald Hornbeck, 56, a resident of the United Kingdom. The other defendants arrested today included: (5) Colonel Enrico Deguzman, 48, of Honolulu, Hawaii, (6) retired Chief Warrant Officer Robert Gorsuch, 48, of Virginia Beach, Virginia (7) retired Rear Admiral Bruce Lovelace, 48, of San Diego, California, (8) active duty Lieutenant Commander Stephen Shedd, 48, of Colorado Springs, Colorado and (9) active duty Commander Mario Herrera, 48, of Helotes, Texas.
The defendants were arrested early this morning in California, Texas, Pennsylvania, Florida, Colorado and Virginia. The United States will seek to move all of these cases to federal court in San Diego, California. Admiral Loveless was taken into custody at his home in Coronado and was expected to make his first appearance in federal court this afternoon.
According to the indictment, the Navy officers allegedly participated in a bribery scheme with Leonard Francis, in which the officers accepted travel and entertainment expenses, the services of prostitutes and lavish gifts in exchange for helping to steep lucrative contracts to Francis and GDMA and to sabotage competing defense contractors. The defendants allegedly violated many of their sworn official naval duties, including duties related to the handling of classified information and duties related to the identification and reporting of foreign intelligence threats. According to the indictment, the defendants allegedly worked in concert to recruit new members for the conspiracy, and to keep the conspiracy secret by using fake names and foreign email service providers. According to the indictment, the bribery scheme allegedly cost the Navy – and U.S. taxpayers – tens of millions of dollars.
In addition to the nine defendants charged today, the 11 Navy officials charged so far in the fraud and bribery investigation are: (1) Admiral Robert Gilbeau, (2) retired Captain Michael Brooks, (3) Commander Jose Luis Sanchez, (4) Captain Daniel Dusek, (5) former Department of Defense civilian employee Paul Simpkins, (6) Commander Michael Misiewicz, (7) Lieutenant Commander Gentry Debord, (8) Lieutenant Commander Todd Malaki, (9) Petty Officer First Class Daniel Layug, (10) Naval Criminal Investigative Service Supervisory Special Agent John Beliveau and (11) Commander Bobby Pitts.
Gilbeau, Brooks, Sanchez, Dusek, Simpkins, Misiewicz, Debord, Malaki, Layug and Beliveau have pleaded guilty. Gilbeau, Brooks, and Sanchez await sentencing. On March 25, 2016, Dusek was sentenced to 46 months in prison and ordered to pay a $70,000 fine and $30,000 in restitution to the Navy. On Dec. 2, 2016, Simpkins was sentenced to 72 months in prison. On April 29, 2016, Misiewicz was sentenced to 78 months in prison and ordered to pay a $100,000 fine and $95,000 in restitution to the Navy. On Jan. 12, 2017, Debord was sentenced to 30 months in prison and ordered to pay a $15,000 fine and $37,000 in restitution to the Navy. On Jan. 29, 2016, Malaki was sentenced to 40 months in prison and ordered to pay a $15,000 fine and $15,000 in restitution to the Navy. On Jan. 21, 2016, Layug was sentenced to 27 months in prison and a $15,000 fine. On Oct. 14, 2016, Beliveau was sentenced to 12 years in prison and ordered to pay $20 million in restitution to the Navy. Pitts was charged in May 2016 and his case is pending.
Additionally, to date, five GDMA executives have been charged: (1) Alex Wisidagama, (2) Francis, (3) Edmund Aruffo, (4) Neil Peterson and (5) Linda Raja. Three have pleaded guilty: Wisidagama, Francis and Aruffo. On March 18, 2016, Wisidagama was sentenced to 63 months in prison and ordered to pay $34.8 million in restitution to the Navy. Francis and Aruffo await sentencing. Peterson and Raja were extradited to the United States from Singapore in September 2016 and their cases remain pending.
The charges and allegations contained in an indictment are merely accusations. The defendants are presumed innocent unless and until proven guilty.
DCIS, NCIS and the Defense Contract Audit Agency are investigating the case. Assistant Chief Brian R. Young of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Mark W. Pletcher and Patrick Hovakimian of the Southern District of California are prosecuting the case.
Anyone with information relating to fraud or corruption should contact the NCIS anonymous tip line at www.ncis.navy.mil or the DOD Hotline at www.dodig.mil/hotline or call (800) 424-9098.
GDMA IndictmentU.S. Navy Admiral Plus Eight Officers Indicted as Part of Corrupt Team that Worked Together to Trade Navy Secrets for Sex PartiesRead the Press Release
Assistant U.S. Attorneys Mark W. Pletcher (619) 546-9714 and Patrick Hovakimian (619) 546-9718
NEWS RELEASE SUMMARY – March 14, 2017
SAN DIEGO – Retired U.S. Navy Rear Admiral Bruce Loveless and David Newland, chief of staff to the Commander of the Navy’s Seventh Fleet, along with seven other high-ranking Navy officers are charged in a federal grand jury indictment with acting as a team of moles for a foreign defense contractor, trading military secrets and substantial influence for sex parties with prostitutes, extravagant dinners and luxury travel.
According to a federal grand jury indictment unsealed today, the Navy officers worked together to help Singapore-based defense contractor Leonard Glenn Francis and his company, Glenn Defense Marine Asia, pull off a colossal fraud that ultimately cost the Navy – and U.S. taxpayers – tens of millions of dollars.
Navy officers were arrested early this morning in California, Texas, Florida, Colorado and Virginia. The United States will seek their removal to face charges in San Diego. Admiral Loveless was taken into custody at his home in Coronado and was expected to make his first appearance in federal court in San Diego at 2 p.m. before U.S. Magistrate Judge Mitchell D. Dembin. The other defendants are Captains David Newland, James Dolan, Donald Hornbeck and David Lausman; Marine Corps Colonel Enrico DeGuzman; Commander Mario Herrera; Lt. Commander Stephen Shedd and Chief Warrant Officer Robert Gorsuch. DeGuzman is also scheduled to appear before Judge Dembin today at 2 p.m.
The defendants face various charges including bribery, conspiracy to commit bribery, honest services fraud and obstruction of justice and making false statements to federal investigators when confronted about their actions. Two defendants – Shedd and Herrera - are active duty; the others are recently retired.
The indictment is a veritable 78-page list of allegations in which Francis spent tens of thousands of dollars on bribing the defendants and the actions the officers took to reciprocate. Francis plied the officers with things like foie gras terrine, duck leg confit, ox-tail soup, $2,000 boxes of cigars and $2,000 bottles of rare cognac, plus wild sex parties in fancy hotels.
For their part, the defendants allegedly worked in concert to help Francis and GDMA win and keep defense contracts to provide port services to U.S. Navy ships; to redirect ships to ports controlled by Francis in Southeast Asia so he could overbill the Navy for supplies and services such as food, water, fuel, tugboats, and sewage removal; to sabotage competing defense contractors; to recruit new members for the conspiracy by spreading the “Glenn Gospel” to incoming Seventh Fleet leaders; and to keep the conspiracy secret by using fake names and foreign email service providers.
Including today’s defendants, a total of 25 named individuals have been charged in connection with the GDMA corruption and fraud investigation. Of those, 20 are current or former U.S. Navy officials; five are GDMA executives. Thirteen have pleaded guilty; other cases are pending.
“This is a fleecing and betrayal of the United States Navy in epic proportions, and it was allegedly carried out by the Navy’s highest-ranking officers,” said Acting U.S. Attorney Alana W. Robinson. “The alleged conduct amounts to a staggering degree of corruption by the most prominent leaders of the Seventh Fleet – the largest fleet in the U.S. Navy - actively worked together as a team to trade secrets for sex, serving the interests of a greedy foreign defense contractor, and not those of their own country.”
“The defendants in this indictment were entrusted with the honor and responsibility of administering the operations of the U.S. Navy’s Seventh Fleet, which is tasked with protecting our nation by guarding an area of responsibility that spanned from Russia to Southeast Asia and the Indian Ocean,” said Acting Assistant Attorney General Kenneth A. Blanco. “With this honor and awesome responsibility came a duty to make decisions based on the best interests of the Navy and the 40,000 Sailors and Marines under their care who put their lives at risk every day to keep us secure and free. Unfortunately, however, these defendants are alleged to have sold their honor and responsibility in exchange for personal enrichment.”
“The allegations contained in today’s indictment expose flagrant corruption among several senior officers previously assigned to the U.S. Navy's Seventh Fleet. The charges and subsequent arrests are yet another deplorable example of those who place their own greed above their responsibility to serve this nation with honor,” said Dermot F. O'Reilly, Director, Defense Criminal Investigative Service.
“Naval Criminal Investigative Service, in concert with our partner agencies, remains resolved to follow the evidence wherever it leads, and to help hold accountable those who make personal gain a higher priority than professional responsibility,” Special Agent Andrew L. Traver, NCIS Director. “It's unconscionable that some individuals choose to enrich themselves at the expense of military security.”
Here’s a sampling of bribes alleged in the indictment:
-During the U.S.S. Blue Ridge’s port visit to Sydney Australia on June 17, 2007, Francis hosted and paid for a dinner event at the Altitude Restaurant within the Shangri-La Hotel. Some of the defendants dined on saute of scallops, foie gras, and beef loin for a cost of $11,898. During dinner, defendant Gorsuch handed Francis two floppy disks containing classified port visit information for many U.S. Navy ships, according to the indictment.
-In March 2007, Francis hosted and paid for a multi-course dinner for several of the defendants at the Oak Door in Tokyo, Japan. The menu included foie gras, Lobster Thermidor, Sendai Tenderloin, and for dessert, Liberte Sauvage, the winning cake of the 10th Coupe du Monde de la Patisserie 2007, followed by cognac and cigars. Each course was paired with fine champagne or wine. Attendees posed for photographs wearing custom-made GDMA neckties that Francis had given them as gifts.
-During one port visit in Singapore on March 9, 2006, Francis seduced the leaders of the Seventh Fleet with foie gras terrine, duck leg confit, ox-tail soup, roasted Chilean sea bass, paired with expensive wine and champagne, followed by digestifs and cigars. The extravagance included $600-a-bottle Hennessy Private Reserve, $2,000-a-bottle Paradis Extra and $2,000-a-box Cohiba Cigars.
According to the indictment, the group of officers referred to themselves using various terms, such as “the Cool Kids,” “the Band of Brothers,” “the Brotherhood,” “the Wolfpack,” “the familia,” and “the Lion King’s Harem.” The officers tried to conceal their corrupt relationships by using fictitious names to create email addresses using foreign-based email services.
This is the first time multiple officers are charged as working all together in a multi-layered conspiracy, pooling their individual and collective resources and influence on behalf of Francis.
In addition to performing various official acts in return for Francis’s booty, these officers are also accused of violating many of the sworn official duties required of them as Navy officers, including duties related to the handling of classified information and duties related to the identification and reporting of foreign intelligence threats.
The U.S. Navy’s Seventh Fleet represents a vital piece of the United States military’s projection of power as well as American foreign policy and national security. The largest numbered fleet in the U.S. Navy, the Seventh Fleet comprises 60-70 ships, 200-300 aircraft and approximately 40,000 Sailors and Marines. The Seventh Fleet is responsible for U.S. Navy ships and subordinate commands which operate in the Western Pacific Ocean throughout Southeast Asia, Pacific Islands, Australia, and Russia as well as the Indian Ocean territories, as well ships and personnel from other U.S. Navy Fleets that enter the Seventh Fleet’s area of responsibility. The U.S.S. Blue Ridge is the command-and-control ship of the Seventh Fleet and housed at-sea facilities for Seventh Fleet senior officials.
The Seventh Fleet’s motto: Ready Power for Peace.
In addition to the nine defendants charged today, the 11 Navy officials charged so far in the fraud and bribery investigation are: Admiral Robert Gilbeau; Captain Michael Brooks; Captain Daniel Dusek; Commander Jose Luis Sanchez; Commander Michael Misiewicz; Commander Bobby Pitts; Lt. Commander Gentry Debord; Lt. Commander Todd Malaki; Petty Officer First Class Daniel Layug; Naval Criminal Investigative Service Supervisory Special Agent John Beliveau; and Paul Simpkins, a former DoD civilian employee, who oversaw contracting in Singapore.
Gilbeau, Brooks, Dusek, Misiewicz, Sanchez, Debord, Malaki, Layug, Beliveau, and Simpkins have pleaded guilty. On Jan. 21, 2016, Layug was sentenced to 27 months in prison and a $15,000 fine; on Jan. 29, 2016, Malaki was sentenced to 40 months in prison and to pay $15,000 in restitution to the Navy and a $15,000 fine. On March 25, 2016, Dusek was sentenced to 46 months in prison and to pay $30,000 in restitution to the Navy and a $70,000 fine; and on April 29, 2016, Misiewicz was sentenced to 78 months in prison and to pay a fine of $100,000 and to pay $95,000 in restitution to the Navy. Beliveau was sentenced on October 14, 2016 to 12 years in prison and to pay $20 million in restitution; Simpkins was sentenced on December 2, 2016 to 72 months in prison; Gilbeau, Brooks, and Sanchez await sentencing. Pitts was charged in May 2016 and his case is pending.
Also charged are five GDMA executives – Francis, Alex Wisidagama, Edmund Aruffo, Neil Peterson and Linda Raja. Three have pleaded guilty; Wisidagama was sentenced on March 18, 2016 to 63 months in prison and $34.8 million in restitution to the U.S. Navy. Francis and Aruffo await sentencing. Peterson and Raja were extradited to the United States from Singapore in September 2016 and their cases remain pending.
The Defense Criminal Investigative Service, Naval Criminal Investigative Service, and the Defense Contract Audit Agency are investigating. Assistant U.S. Attorneys Mark W. Pletcher and Patrick Hovakimian of the Southern District of California and Assistant Chief Brian R. Young of the Criminal Division’s Fraud Section are prosecuting the case.
Anyone with information relating to fraud or corruption should contact the NCIS anonymous tip line at www.ncis.navy.mil or the DOD Hotline at www.dodig.mil/hotline, or call (800) 424-9098.
DEFENDANTS Case Number: 17CR0623-JLS
Captain David Newland Age 60 San Antonio, Texas
Chief of Staff to the Commander of the Seventh Fleet
Colonel Enrico DeGuzman Age 58 Honolulu, Hawaii
Fleet Marine Office of the Seventh Fleet, responsible for coordinating the missions of the U.S. Marine Corps with the Seventh Fleet; and Assistant Chief of Staff of Operations for U.S. Marine Corps Forces, Pacific
Captain James Dolan Age 58 Gettysburg, Pennsylvania
Assistant Chief of Staff for Logistics for the Seventh Fleet, responsible for meeting the logistical needs of every ship within the Seventh Fleet’s area of responsibility
Captain Donald Hornbeck Age 56 United Kingdom
Deputy Chief of Staff for Operations for the Seventh Fleet, responsible for directing the operations of all combatant ships in the Seventh Fleet area of responsibility
Rear Admiral, Retired, Bruce Loveless Age 53 Coronado, CA
Previously a Captain and Assistant Chief of Staff for Intelligence for the Seventh Fleet, responsible for assessing and counteracting foreign intelligence threats within the Seventh Fleet’s area of responsibility
Captain David Lausman Age 62 The Villages, Florida
Executive Officer of the aircraft carrier U.S.S. Abraham Lincoln; Commanding Officer of U.S.S. Blue Ridge; Commanding Officer of U.S.S. George Washington
Lt. Commander Stephen Shedd Age 43 Colorado Springs, CO
Seventh Fleet’s South Asia Policy and Planning Officer, responsible for identifying ports that U.S. Navy ships would visit; and once promoted to Commander, served as Executive Officer and Commanding Officer of the U.S.S. Milius
Commander Mario Herrera Age 48 Helotes, Texas
Fleet Operations and Schedules Officer for the Seventh Fleet, responsible for scheduling the port visits for ships and submarines in the Seventh Fleet’s area of responsibility (Herrera was previously charged in February 2017 via complaint)
Chief Warrant Officer Robert Gorsuch Age 49 Virginia Beach, Virginia
Seventh Fleet’s Flag Administration Officer, responsible for providing administrative support to the Seventh Fleet Commander and other senior officers on the Seventh Fleet staff
SUMMARY OF CHARGES
Conspiracy to Commit Bribery, in violation of 18 U.S.C. § 371
Maximum Penalty: 5 years in prison, a $250,000 fine, or twice the gross pecuniary gain or twice the gross pecuniary loss, whichever is greater
Bribery, in violation of 18 U.S.C. § 201
Maximum Penalty: 15 years in prison, a $250,000 fine or twice the gross pecuniary gain or gross pecuniary loss from the offense, or three times the monetary equivalent of the thing of value, whichever is greater
False Statements, in violation of 18 U.S.C. § 1001
Maximum Penalty: 5 years in prison, a $250,000 fine
Obstruction of Justice, in violation of 18 U.S.C. § 1519
Maximum Penalty: 20 years in prison, a $250,000 fine
Conspiracy to Commit Honest Services Wire Fraud, in violation of 18 U.S.C. §§ 1349, 1346, 1343
Maximum Penalty: 20 years in prison, a $250,000 fine
INVESTIGATING AGENCIES
Defense Criminal Investigative Service
Naval Criminal Investigative Service
Defense Contract Audit Agency
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
BREAKDOWN OF COUNTS
Counts
Code
Description
Defendant(s)
1
18 U.S.C. § 371
Conspiracy to Commit Bribery
All
2
18 U.S.C § 201(b)(2)(A) and (C)
Bribery
Newland
3
18 U.S.C § 201(b)(2)(A) and (C)
Bribery
DeGuzman
4
18 U.S.C § 201(b)(2)(A) and (C)
Bribery
Hornbeck
5
18 U.S.C § 201(b)(2)(A) and (C)
Bribery
Dolan
6
18 U.S.C § 201(b)(2)(C)
Bribery
Loveless
7
18 U.S.C § 201(b)(2)(A) and (C)
Bribery
Lausman
8
18 U.S.C § 201(b)(2)(A) and (C)
Bribery
Herrera
9
18 U.S.C § 201(b)(2)(A) and (C)
Bribery
Shedd
10
18 U.S.C § 201(b)(2)(A) and (C)
Bribery
Gorsuch
11
18 U.S.C. § 1001(a)(2)
False Statements
Lausman
12
18 U.S.C. § 1519
Obstruction
Lausman
13
18 U.S.C. §§ 1349, 1346, and 1343
Conspiracy to Commit Honest Services Wire Fraud
All
U.S. Attorney Charges Registered Sexual Offender in Westchester County with Sexual Exploitation of A MinorRead the Press Release
Joon H. Kim, Acting United States Attorney for the Southern District of New York, and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Division of the Federal Bureau of Investigation (“FBI”), announced the arrest and filing of charges against DAVID OHNMACHT, a 36-year-old registered sexual offender in Westchester, New York. The Amended Complaint filed yesterday in White Plains federal court charges that OHNMACHT persuaded a 14-year-old girl (“Victim-1”) to engage in sexually explicit activity, video it, and transmit it, via Instagram, to OHNMACHT. The Amended Complaint also charges that OHNMCHT engaged in that conduct while being someone required to register as a sexual offender. OHNMACHT was presented yesterday before U.S. Magistrate Judge Judith McCarthy in White Plains federal court and detained without bail.
If convicted, OHNMACHT faces a mandatory minimum sentence of 35 years in prison and a maximum sentence of 50 years in prison.
Acting U.S. Attorney Joon H. Kim said: “David Ohnmacht allegedly convinced a 14-year-old girl to send him sexually explicit videos of herself and threatened to release it to her friends if she did not send more. It is one of law enforcement’s most important missions to protect children from this type of allegedly predatory conduct.”
FBI Assistant Director William F. Sweeney Jr. said: “Our job as law enforcement is to protect people from criminals, but our job gets harder as more predators approach children and take advantage of them. Those alleged predators have more access in this digital age than they’ve ever had before, but as parents we have to be the first line of defense by talking with them and making sure they know the dangers that lurk online. The alleged subject in this case is what parents fear the most, a known sexual predator making contact with their child. Our jobs may get harder, but that won’t stop us from going after and stopping criminals from preying on our children.”
According to the Amended Complaint filed today in White Plains federal court[1]:
From November 2016 through February 2017, OHNMACHT communicated online via Instagram with a 14-year-old girl (“Victim-1”) and convinced Victim-1 to take and transmit sexually explicit videos of Victim-1 to OHNMACHT.
OHNMACHT utilized the screen names “Dannyw290” and “little.kitty.love” during his communications with Victim-1. OHNMACHT told Victim-1 that if she did not make and transmit additional videos, he would expose Victim-1’s prior videos to her friends on Instagram.
OHNMACHT was convicted on August 19, 2003, in Westchester County Court of multiple sexual abuse and sexual assault charges including Sexual Abuse in the Third Degree, Possessing an Obscene Sexual Performance by a Child less than 16 years old, Rape in the First Degree, Use of a Child less than 17 years of age in a sexual performance, Possessing a Sexual Performance by a child less than 16 years of age, Sexual Abuse in the First Degree, Promoting a Sexual Performance by a child less than 17 years of age, and Sodomy, Intercourse, Forcible Compulsion. OHNMACHT was sentenced to a term of imprisonment of 40 months to ten years. He served approximately nine years in prison and was released on or about November 1, 2011. OHNMACHT then began a five-year term of post-release supervision with New York State Parole that ended on or about November 1, 2016.
OHNMACHT’s prior convictions involved four different victims, who ranged in age from 13 to 15. As a result of his convictions, OHNMACHT was required to register with the New York State Sex Offender Registry.
OHNMACHT was arrested yesterday morning in Katonah, New York.
Mr. Kim praised the efforts of the FBI. He also thanked the FBI’s Wilmington, North Carolina, Resident Agency, the New Hanover County Sheriff’s Office in Wilmington, North Carolina, and the Bedford, New York, Police Department in connection with this investigation.
Mr. Kim stated that the investigation is ongoing. Any individuals with relevant information concerning DAVID OHNMACHT and any individuals who may have encountered someone using the user names “Dannyw290” or “little.kitty.love” should contact the FBI at (914) 925-3700.
The prosecution is being handled by the Office’s White Plains Division. Assistant United States Attorney Marcia S. Cohen is in charge of the prosecution.
[1] As the introductory phrase signifies, the entirety of the text of the Amended Complaint and the description of the Amended Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Two Mexican Nationals Plead Guilty to Growing Marijuana at Federal Wildlife RefugeRead the Press Release
JEFFERSON CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced that two Mexican nationals pleaded guilty in federal court today to their involvement in a large marijuana-growing operation at a federal wildlife refuge in Howard County, Mo.
Carlos Horacio Vasquez-Duarte, 27, and Rigaberto Camacho Reyes, 24, both citizens of Mexico, pleaded guilty before U.S. Magistrate Judge Matt J. Whitworth to their roles in the conspiracy.
Law enforcement officers discovered a large marijuana growing operation on federal land at the Big Muddy National Fish and Wildlife Refuge on Oct. 25, 2016. Vasquez-Duarte and Reyes were arrested at the site, approximately one mile from County Road 317 in Howard County. Vasquez-Duarte had a large amount of marijuana in a tarp on his shoulder, and was hauling the marijuana to one of the processing tents nearby as he walked along one of the many paths that connected areas of the operation. Reyes was also carrying marijuana plants at the time he was taken into custody.
The grow operation encompassed approximately five acres and included five tents where marijuana was hung, dried, packaged and processed for delivery. At least three separate locations had marijuana growing, with plants approximately five to six feet tall. Several plants had been pruned and trimmed to allow the marijuana plants to grow larger and produce a maximum amount of raw marijuana.
The grow operation contained hundreds of marijuana plants in the ground, cut plants drying in the tents, raw marijuana prepared for processing, and hundreds of plants which had been processed and the picked stalks laying on the ground. A U.S. Fish & Wildlife Service agent calculated that there were 881 plants in the ground and 1,103 plants that had been cut and were drying.
A water system ran throughout the grow operation. Black plastic tubing was observed on the ground. Large plastic containers were located to store water and supply the grow operation by utilizing the black plastic tubing running to each field. An area of the grow operation contained a large amount of fertilizer, bedding supplies, pruning devices and chemicals used in the growing and cultivation of marijuana. Two tents were located in the middle of the operation, which appeared to be the location where people would sleep and cook. There was a fire pit and sleeping bags in this area.
Under federal statutes, Vasquez-Duarte and Reyes are each 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 Lawrence E. Miller. It was investigated by the U.S. Fish and Wildlife Service – Refuge Law Enforcement Division, the Missouri Department of Conservation, the Drug Enforcement Administration, the Missouri State Highway Patrol, the East Central Drug Task Force, the Howard County, Mo., Sheriff’s Department, the Glasgow, Mo., Police Department, the Fayette, Mo., Police Department and the New Franklin, Mo., Police Department.
Two Identity Document Suppliers Sentenced for Roles in Identity Trafficking SchemeRead the Press Release
Two identity document suppliers were sentenced to prison today for their role in trafficking the identities of Puerto Rican U.S. citizens and corresponding identity documents.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, U.S. Attorney Rosa E. Rodríguez-Vélez of the District of Puerto Rico, Executive Associate Director Peter T. Edge of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Chief Postal Inspector Guy J. Cottrell of the U.S. Postal Inspection Service (USPIS), Acting Director Christian J. Schurman of the U.S. State Department’s Diplomatic Security Service (DSS) and Chief Richard Weber of the Internal Revenue Service-Criminal Investigation (IRS-CI) made the announcement.
Francisco Matos-Beltre, 43, a Dominican national who became a U.S. citizen in 2013, formerly of Philadelphia, was sentenced to serve 51 months in prison and three years’ supervised release. Isaias Beltre-Matos, 46, a Dominican national and legal permanent resident formerly of Providence, Rhode Island, was sentenced to serve 51 months in prison and three years’ supervised release. Both defendants were sentenced before U.S. District Judge Juan M. Perez-Gimenez of the District of Puerto Rico. Beltre-Matos pleaded guilty on Aug. 10, 2016, to conspiracy to commit identification fraud and commit human smuggling for financial gain. Matos-Beltre pleaded guilty on Sept. 14, 2016, to conspiracy to commit identification fraud and commit human smuggling for financial gain.
According to admissions made in connection with the pleas, identity document runners located in the Savarona area of Caguas, Puerto Rico, obtained Puerto Rican identities and corresponding identity documents. Other conspirators, identified as identity document suppliers and brokers, located in various cities throughout the United States allegedly solicited customers for the sale of social security cards and corresponding Puerto Rico birth certificates for prices ranging from $400 to $1,200 per set. The defendants also admitted that the conspirators used the U.S. mail to complete their illicit transactions.
According to the pleas, Beltre-Matos admitted that he sold identity documents to customers, who generally obtained the identity documents to assume the identity of Puerto Rican U.S. citizens and to obtain additional identification documents, such as legitimate state driver’s licenses. Some customers obtained the documents to commit financial fraud and attempted to obtain a U.S. passport, according to the plea agreement. Matos-Beltre also admitted to being a document supplier and that he bought and transferred identity documents belonging to real people to document brokers. Matos-Beltre admitted that he knew his customers would fraudulently use the documents that he provided.
The Chicago offices of ICE-HSI, USPIS, DSS and IRS-CI led the investigation, dubbed Operation Island Express II, with assistance from HSI San Juan and the DSS Resident Office in Puerto Rico. The HSI Assistant Attaché office in the Dominican Republic and International Organized Crime Intelligence and Operations Center (IOC-2) as well as various ICE, USPIS, DSS and IRS-CI offices around the country provided invaluable support.
Trial Attorneys Marianne Shelvey of the Criminal Division’s Organized Crime and Gang Section and Frank Rangoussis of the Criminal Division’s Human Rights and Special Prosecutions Section prosecuted the case. The U.S. Attorney’s Office of the District of Puerto Rico is providing assistance in the matter.
Potential victims and the public may obtain information about the case at: www.justice.gov/criminal/vns/caseup/beltrerj.html. Anyone who believes their identity may have been compromised in relation to this investigation may contact the ICE toll-free hotline at 1-866-DHS-2ICE (1-866-347-2423) and its online tip form at www.ice.gov/tipline. Anyone who may have information about particular crimes in this case should also report it to the ICE tip line or website.
Anyone who believes that they have been a victim of identity theft, or wants information about preventing identity theft, may obtain helpful information and complaint forms on various government websites including the Federal Trade Commission ID Theft Website, www.ftc.gov/idtheft. Additional resources regarding identity theft can be found at www.ojp.usdoj.gov/ovc/pubs/ID_theft/idtheft.html; www.ssa.gov/pubs/10064.html; www.fbi.gov/about-us/investigate/cyber/identity_theft; and www.irs.gov/privacy/article/0,,id=186436,00.html.
Title Agent and Co-Conspirator Plead Guilty in $10 Million Mortgage Fraud SchemeRead the Press Release
A title agent and a co-conspirator pled guilty today to federal charges related to their participation in a $10 million mortgage fraud scheme.
Benjamin G. Greenberg, Acting United States Attorney for the Southern District of Florida and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, made the announcement.
Defendants Michelle Cabrera, 48, of Miami Lakes, and Pedro Melian, 39, of Hialeah, pled guilty to one count of conspiracy to commit wire fraud affecting a financial institution, in violation of Title 18, United States Code, Section 1349 (Case No. 16-60349-CR-DIMITROULEAS). At sentencing, each defendant faces up to thirty years? imprisonment.
Defendants Marco Laureti, 45, of Sunny Isles Beach, and Felix Mostelac, 44, of Miami Beach, were charged by Indictment with one count of conspiracy to commit wire fraud affecting a financial institution, in violation of Title 18, United States Code, Section 1349 and multiple counts of wire fraud affecting a financial institution, in violation of Title 18, United States Code, Section 1343 (Case No. 16-60340-CR-ZLOCH), for conduct allegedly related to the fraud scheme, and are awaiting trial.
to court documents, defendants Laureti, Mostelac, Cabrera and Melian were involved with a $10 million mortgage fraud scheme. Laureti was a former newspaper publisher and owner of Laureti Publishing Company, in addition to being a licensed real estate sales associate and mortgage broker. Mostelac was Laureti’s associate and also the owner of several companies. Cabrera owned Florida Elite Title & Escrow in Davie and served as the title agent for these transactions. Melian also owned several companies.
According to information presented in court and accompanying documents, the defendants engaged in a fraud scheme involving a condominium complex located at 45 Hendricks Isle in Fort Lauderdale. Defendants Laureti, Mostelac and Melian made false and fraudulent statements to a financial institution on loan applications and closing statements for the multi-million dollar condominiums. Once the loans were approved, defendant Cabrera, at Laureti’s direction, diverted the loan proceeds to fund the cash the borrower was expected to bring to the property’s closing, as well as diverting additional monies from the loan proceeds to various companies owned by Laureti and Mostelac. Furthermore, according to court documents, Laureti and Mostelac utilized the same scheme on the loan applications and closing statements to purchase their own multi-million dollar residential properties in Miami Beach, in addition to Laureti directing Cabrera to divert funds. The defendants’ scheme defrauded the financial institution of approximately $10 million.
Mr. Greenberg commended the investigative efforts of the FBI. This case is being prosecuted by Assistant U.S. Attorney Randy Katz.
An Indictment merely contains allegations and every defendant is presumed innocent unless and until proven guilty in a court of law.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. 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.
Three Bay Area Insurance Agents Convicted of Conspiracy and Aggravated Identity TheftRead the Press Release
SAN FRANCISCO – Behnam Halali, Ernesto Magat, and Karen Gagarin were found guilty on March 13, 2017, by a federal jury for their respective roles in a scheme to commit wire fraud and identity theft involving fraudulent life insurance policies, announced U.S. Attorney Brian J. Stretch, Federal Bureau of Investigation Special Agent in Charge John F. Bennett, and Internal Revenue Service, Criminal Investigation, Special Agent in Charge Michael T. Batdorf. The verdict follows a four-week trial before the Honorable Susan Illston, United States District Judge in San Francisco.
According to the evidence produced at trial, Halali, 32, of San Jose, Magat, 35, of Hayward, and Gagarin, 32, of San Jose, were former agents of the American Income Life Insurance Company (AIL). While working at AIL, the defendants participated in a conspiracy involving the submission of applications for life insurance policies on behalf of people at least some of whom did not know that a policy was applied for or issued in their name and/or did not want a life insurance policy. The defendants then shared the commissions and bonuses issued by AIL in connection with the fraudulent policies. The defendants paid recruiters to find people willing to take medical exams in exchange for approximately $100, and then took the personal information associated with those people and submitted applications for life insurance in their names, in many cases without the individuals’ knowledge. The defendants and their co-conspirators also paid people to participate in a fictitious survey of a medical exam company, and took the personal information associated with those people and submitted applications for life insurance, in many cases without the individuals’ knowledge. The evidence also demonstrated that the defendants and their co-conspirators created phony driver’s licenses so that their co-conspirators could take medical exams purporting to be the applicants. The defendants opened hundreds of bank accounts to fund the premiums on the fraudulent policies, and typically paid one to four months of premiums before letting the policies lapse. The defendants and their co-conspirators returned verification calls to AIL purporting to be the applicants on the fraudulent applications from telephones set up exclusively for the fraudulent scheme.
All three defendants were charged with conspiracy to commit wire fraud, in violation of 18 U.S.C. § 1349, wire fraud, in violation of 18 U.S.C. § 1343, and aggravated identity theft, in violation of 18 U.S.C. § 1028A(a)(1). Pursuant to today’s verdict, the defendants were found guilty of all these counts. Halali and Magat were also charged with money laundering, in violation of 18 U.S.C. § 1957; these charges were dropped before trial.
Judge Illston scheduled hearings to sentence all three defendants on July 28, 2017. The maximum statutory penalties for conspiracy to commit wire fraud and for wire fraud charges in violation of 18 U.S.C. §§ 1349 and 1343 are a prison term of 20 years, and a fine of $250,000 or twice the gross gain or loss from the offense, plus restitution. The maximum statutory penalty for aggravated identity theft in violation of 18 U.S.C. § 1028A is a mandatory prison sentence of 2 years. Additional fines, restitutions and a term of supervised release may also be ordered, however, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant United States Attorneys Robert Leach and Matthew McCarthy are prosecuting the case with the assistance of Daniel Charlier-Smith, Denise Oki, and Bridget Kilkenny. This prosecution is the result of an investigation by the FBI; the IRS, Criminal Investigation; and the Commissioner of the California Department of Insurance.
Stamford Dental Office Manager Pleads Guilty to Defrauding Insurance CompaniesRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that ELENA ILIZAROV, 44, of Stamford, waived her right to be indicted and pleaded guilty yesterday before U.S. District Judge Victor A. Bolden in Bridgeport to one count of wire fraud stemming from her use of an identity theft victim’s personal identifying information to submit fraudulent bills to private insurance companies offering dental insurance.
According to court documents and statements made in court, ILIZAROV served as the office manager for Advanced Dentistry, a dental practice located in Stamford. Between 2005 and 2016, ILIZAROV billed private dental insurance companies for services allegedly performed by an identity theft victim for patients of Advanced Dentistry, when the victim did not in fact perform those services. The identity theft victim was a dentist who had been affiliated with Advanced Dentistry for a short period of time and retired fully from dentistry in 2011.
Between 2011 and 2015, approximately $581,729 was paid by private insurance companies to Advanced Dentistry for services allegedly provided by the retired dentist. As a result, the insurance companies issued 1099 forms to the Internal Revenue Service pertaining to the retired dentist. In 2015 and 2016, ILIZAROV renewed the retired dentist’s Connecticut dental license and controlled substance registrations, paying for the renewals with her personal credit card. She also applied for, and received, liability insurance in the name of the retired dentist for several years.
The charge of wire fraud carries a maximum term of imprisonment of 20 years. A sentencing date has not been scheduled.
ILIZAROV was arrested on a federal criminal complaint on June 21, 2016. She is released on a $500,000 bond.
This matter is being investigated by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation Division and U.S. Department of Health and Human Services – Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorneys Sarala V. Nagala and David J. Sheldon.
U.S. Attorney Daly encourages individuals who suspect health care fraud to report it by calling the Health Care Fraud Task Force at (203) 777-6311 or 1-800-HHS-TIPS.
South Florida Home Health Owner Charged for Role in $15 Million Medicare Fraud SchemeRead the Press Release
A South Florida home health care owner was charged in an indictment unsealed today for his alleged participation in a $15 million health care fraud scheme involving fraudulent claims for home health services.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Benjamin G. Greenberg of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office and Special Agent-in-Charge Brian Swain of the U.S. Secret Service’s (USSS) Miami Field Office made the announcement.
Yunesky I. Fornaris, 38, of Miami, was charged with one count of conspiracy to commit health care fraud and wire fraud, two counts of health care fraud and one count of conspiracy to defraud the United States and pay health care kickbacks. Fornaris was arrested today and made his initial appearance before U.S. Magistrate Judge William C. Turnoff of the Southern District of Florida.
The indictment alleges that from in or around April 2010 through July 2016, Fornaris and his co-conspirators hid their ownership in Elite Home Care LLC (Elite), a Miami-area home health clinic, in the name of a nominee owner in an effort to conceal their participation in the fraudulent scheme. According to the indictment, Fornaris and his co-conspirators allegedly submitted false and fraudulent application documents, causing Medicare to give and continue to reauthorize Elite’s Medicare provider number. As a result, the number enabled Fornaris and his co-conspirators to allegedly submit fraudulent claims for services that were not medically necessary or never provided. In addition, Fornaris allegedly signed portions of Elite’s Medicare applications and re-certifications committing Elite to comply with Medicare’s rules and regulations, as well as the Federal Anti-Kickback Statute. Notwithstanding these certifications, Fornaris and his co-conspirators allegedly caused kickbacks to be paid to Medicare beneficiaries and patient recruiters in exchange for the referral of Medicare beneficiaries to Elite.
According to the indictment, Medicare paid approximately $15 million as a result of false and fraudulent claims submitted by Elite.An indictment is merely an allegation and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The FBI, HHS-OIG and USSS investigated the case, which was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office of the Southern District of Florida. Former Fraud Section Attorney and current Assistant U.S. Attorney Lisa H. Miller of the Southern District of Florida and Fraud Section Attorney Adam G. Yoffie are prosecuting the case.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 3,000 defendants who have collectively billed the Medicare program for more than $11 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
South Florida Home Health Owner Charged for Role in $15 Million Medicare Fraud SchemeRead the Press Release
A South Florida home health care owner was charged in an indictment unsealed today for his alleged participation in a $15 million health care fraud scheme involving fraudulent claims for home health services.
Acting U.S. Attorney Benjamin G. Greenberg of the Southern District of Florida, Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office and Special Agent in Charge Brian Swain of the U.S. Secret Service’s (USSS) Miami Field Office made the announcement.
Yunesky I. Fornaris, 38, of Miami, was charged with one count of conspiracy to commit health care fraud and wire fraud, two counts of health care fraud and one count of conspiracy to defraud the United States and pay health care kickbacks. Fornaris was arrested today and made his initial appearance before U.S. Magistrate Judge William C. Turnoff of the Southern District of Florida.
The indictment alleges that from in or around April 2010 through July 2016, Fornaris and his co-conspirators hid their ownership in Elite Home Care LLC (Elite), a Miami-area home health clinic, in the name of a nominee owner in an effort to conceal their participation in the fraudulent scheme. According to the indictment, Fornaris and his co-conspirators allegedly submitted false and fraudulent application documents, causing Medicare to give and continue to reauthorize Elite’s Medicare provider number. As a result, the number enabled Fornaris and his co-conspirators to allegedly submit fraudlent claims for services that were not medically necessary or never provided. In addition, Fornaris allegedly signed portions of Elite’s Medicare applications and re-certifications committing Elite to comply with Medicare’s rules and regulations, as well as the Federal Anti-Kickback Statute. Notwithstanding these certifications, Fornaris and his co-conspirators allegedly caused kickbacks to be paid to Medicare beneficiaries and patient recruiters in exchange for the referral of Medicare beneficiaries to Elite.
According to the indictment, Medicare paid approximately $15 million as a result of false and fraudulent claims submitted by Elite.
An indictment is merely an allegation and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The FBI, HHS-OIG and USSS investigated the case, which was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office of the Southern District of Florida. Former Fraud Section Attorney and current Assistant U.S. Attorney Lisa H. Miller of the Southern District of Florida and Fraud Section Attorney Adam G. Yoffie are prosecuting the case.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 3,000 defendants who have collectively billed the Medicare program for more than $11 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. 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.
Seward Man Sentenced for Clean Air Act ViolationsRead the Press Release
Acting United States Attorney Robert C. Stuart announced that Patrick Keough, 59, of Seward, Nebraska, was sentenced Monday in federal court in Omaha on two counts of violating the Clean Air Act. The Honorable Laurie Smith Camp sentenced Keough to six months’ imprisonment. After his release from prison, he will begin a one-year term of supervised release.
Keough is the owner of America’s Fiberglass Animals (AFA). AFA uses gel coats and Hazardous Air Pollutant (HAP) paints to manufacture fiberglass animals. The Nebraska Department of Environmental Quality (NDEQ) determined that AFA required a construction permit and fabric filters in the manufacturing area to operate its business. Keough continued to operate his business in Shelton, Nebraska, without securing a permit or installing fabric filters. He then moved the business to Minden, Nebraska, without advising NDEQ and without securing the required permit. The business continued to operate without fabric filters
This case was investigated by United States Environmental Protection Agency Region VII. The Nebraska Department of Environmental Quality assisted with the investigation.