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Monday 23 January 2017
Mother and son convicted of $7 million healthcare fraud schemeRead the Press Release
A mother and son were convicted of crimes related to a $7 million home healthcare fraud conspiracy in which they provided forged documents and fraudulent forms to bill for services that were not provided.
Delores L. Knight, 70, of Cleveland Heights and Isaac R. Knight, 29, of Macedonia were convicted following a trial of conspiracy to commit healthcare fraud and health care fraud. Delored Knight was also convicted of multiple counts of money laundering.
Delores Knight owned Just Like Familee II, Inc., and Just Like Familee III, Inc., which she incorporated in 2005 and 2006, respectively, to provide home health services for elderly and disabled clients. Isaac Knight served as manager. The companies had locations at various times in Cleveland Heights, Twinsburg and Mentor, according to court documents.
Together they defrauded Medicaid, Medicare and the Department of Veteran Affairs out of more than $7 million as a result of the conspiracy in which they prepared and submitted forged or false records in support of previously submitted and reimbursed billings for patients they did not actually provide face-to-face services, according to trial testimony and court documents.
“These defendants stole millions of dollars by billing for services they never provided,” said U.S. Attorney Carole S. Rendon. “We will do our best to get whatever assets they have and make sure they go to prison.”
The defendants are expected to be sentenced later this year.
Prosecutors are seeking to forfeit all money that was illegally obtained, as well as a home at 1048 Morning Glory Drive in Macedonia owned by Delores L. Knight.
This case was prosecuted by Assistant U.S. Attorneys Mark Bennett and James L. Morford and Special Assistant U.S. Attorney Maritsa Flaherty following an investigation by the Department of Health and Human Services, the FBI, the IRS, the Department of Veteran’s Affairs and the Ohio Attorney General’s Office.
Maryland MS-13 Member Sentenced to Life in Federal Prison for Racketeering Conspiracy, Including MurderRead the Press Release
Greenbelt, Maryland – U.S. District Judge Roger W. Titus sentenced Miguel Angel Manjivar, aka “Masflow or “Garra,” age 25, of Hyattsville, Maryland, today to 30 years in federal prison for conspiracy to participate in a racketeering enterprise, and to life in prison for murder in aid of racketeering, in connection with his gang activities as a member of La Mara Salvatrucha, or MS-13. Judge Titus ordered that the sentences be served consecutively. Manjivar was convicted by a federal jury on September 30, 2016.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Acting Assistant Attorney General Kenneth Blanco of the Justice Department’s Criminal Division; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Chief Hank Stawinski of the Prince George’s County Police Department; Chief J. Thomas Manger of the Montgomery County Police Department; Prince George’s County State’s Attorney Angela D. Alsobrooks; and Montgomery County State’s Attorney John McCarthy.
MS-13 is a national and transnational gang composed primarily of immigrants or descendants from El Salvador. Branches or “cliques” of MS-13, one of the largest street gangs in the United States, operate throughout Prince George’s County and Montgomery County, Maryland. MS-13 members are required to commit acts of violence to maintain membership and discipline within the gang. One of the principal rules of MS-13 is that its members must attack and kill rivals, known as “chavalas,” whenever possible.
According to evidence presented at the three-week trial, from at least 2009 through October 2014, MS-13 members planned and committed numerous crimes, including murders, attempted murders, kidnappings, assaults, robberies, and witness tampering and retaliation in Prince George’s and Montgomery Counties. Gang members also extorted brothel operators and owners of other illegal businesses and tampered with and retaliated against witnesses, among other crimes. Manjivar was a member of the MS-13 Peajes Locotes Salvatrucha clique.
Trial evidence showed that on September 16, 2010, Manjivar shot and killed an individual he believed to be a rival gang member on the footbridge of a park in Hyattsville. On January 10, 2011, Manjivar and other MS-13 members murdered a person they believed was a rival gang member, and attempted to murder another purported rival gang member, in the parking lot of a grocery store on University Boulevard in Hyattsville. Manjivar and others repeatedly punched, kicked, and stabbed the victims, one of whom survived the attack.
In addition, trial evidence demonstrated that on January 13, 2011, after attending a Peajes clique meeting at which he criticized other MS-13 members for not committing enough violent crimes, Manjivar and other MS-13 Peajes members got into a mini-van driven by a co-defendant. Near the Fort Totten Metro Station, they saw a person they believed was an associate of a rival gang. Manjivar and other MS-13 members attacked the victim and dragged him back into the mini-van. Manjivar and others continued to assault him, at times attempting to use a seat belt to strangle the victim. They eventually parked near a dead end in the vicinity of Chillum Manor Road. Manjivar and others kicked, stabbed and choked the victim. They forcefully stripped the victim of all of his heavy winter clothing in order to stab him. After assaulting the victim near the mini-van, they dragged the victim into the woods, where they left him for dead, and fled. The victim survived the attack.
Fourteen of the 15 defendants charged in this investigation have been convicted for their roles in the racketeering conspiracy. The final defendant is a fugitive.
United States Attorney Rod J. Rosenstein commended HSI Baltimore, Prince George’s County and Montgomery County Police Departments, and Prince George’s and Montgomery County State’s Attorney’s Offices for their work in the investigation and prosecution. Mr. Rosenstein thanked Assistant United States Attorneys William D. Moomau and Lindsay Eyler Kaplan, and Trial Attorney Catherine K. Dick with the Justice Department’s Organized Crime and Gang Section, who prosecuted the case. Former OCGS Trial Attorney Kevin Rosenberg assisted in the prosecution.
Maryland MS-13 Member Sentenced to Life in Federal Prison for Racketeering Conspiracy Including MurderRead the Press Release
A Hyattsville, Maryland, man was sentenced today to 30 years in federal prison for conspiracy to participate in a racketeering enterprise and to life in prison for murder in aid of racketeering, in connection with his gang activities as a member of La Mara Salvatrucha, or MS-13.
The sentence was announced by Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Chief Hank Stawinski of the Prince George’s County Police Department; Chief J. Thomas Manger of the Montgomery County Police Department; Prince George’s County State’s Attorney Angela D. Alsobrooks; and Montgomery County State’s Attorney John McCarthy.
In addition to today’s consecutive prison sentences, U.S. District Judge Roger W. Titus of the District of Maryland ordered Miguel Angel Manjivar, aka "Masflow" or "Garra," 25, to serve five years of supervised release. Manjivar was convicted by a federal jury on Sept. 30, 2016.
MS-13 is a national and transnational gang composed primarily of immigrants or descendants from El Salvador. Branches or "cliques" of MS-13, one of the largest street gangs in the United States, operate throughout Prince George’s County and Montgomery County, Maryland. MS-13 members are required to commit acts of violence to maintain membership and discipline within the gang. One of the principal rules of MS-13 is that its members must attack and kill rivals, known as "chavalas," whenever possible.
According to evidence presented at the three-week trial, from at least 2009 through October 2014, MS-13 members planned and committed numerous crimes, including murders, attempted murders, kidnappings, assaults, robberies, and witness tampering and retaliation in Prince George’s and Montgomery counties. Gang members also extorted brothel operators and owners of other illegal businesses and tampered with and retaliated against witnesses, among other crimes. Manjivar was a member of the MS-13 Peajes Locotes Salvatrucha clique.
Trial evidence showed that on Sept. 16, 2010, Manjivar shot and killed an individual he believed to be a rival gang member on the footbridge of a park in Hyattsville. On Jan. 10, 2011, Manjivar and other MS-13 members murdered a person they believed was a rival gang member, and attempted to murder another purported rival gang member in a parking lot in Hyattsville. Manjivar and others repeatedly punched, kicked, and stabbed the victims, one of whom survived the attack.
In addition, trial evidence demonstrated that on Jan. 13, 2011, Manjivar attended a Peajes Clique meeting, where he criticized other MS-13 members for not committing enough violent crimes. Manjivar then left in a mini-van driven by a co-defendant with other Peajes members as passengers, and as a group, they attacked a person they believed to be an associate of a rival gang and dragged him back into the vehicle. Manjivar and others continued to assault him, at times attempting to use a seat belt to strangle the victim, as well as kicked, stabbed and choked him. Trial evidence demonstrated that they forcefully stripped the victim of his heavy winter clothing in order to stab him, and then dragged him into the woods, where they left him for dead and fled. The victim survived the attack.
Fourteen of the 15 defendants charged in this investigation have been convicted for their roles in the racketeering conspiracy. The final defendant is a fugitive.
HSI Baltimore, Prince George’s County and Montgomery County Police Departments, and Prince George’s County and Montgomery County State’s Attorney’s Offices investigated the case. The case is being prosecuted by Assistant United States Attorneys William D. Moomau and Lindsay Eyler Kaplan of the District of Maryland and Trial Attorney Catherine K. Dick of the Criminal Division’s Organized Crime and Gang Section (OCGS). Former OCGS Trial Attorney Kevin Rosenberg assisted in the prosecution of this case.
Man Pleads Guilty to Bank Robbery He Blamed on a Fight with His WifeRead the Press Release
KANSAS CITY, KAN. B A Kansas City, Kan., man who told investigators he preferred jail to living with his wife pleaded guilty Monday to a federal bank robbery charge, U.S. Attorney Tom Beall said.
Lawrence John Ripple, 70, Kansas City, Kan., pleaded guilty to one count of bank robbery. A criminal complaint in the case alleged that on Sept. 2, 2016, Ripple sat down in the lobby and waited for police after robbing the Bank of Labor at 756 Minnesota Ave. in Kansas City, Kan. He told investigators that after an argument with his wife he felt he would rather be in prison than go back home.
Sentencing will be set for a later date. He faces up to 20 years in federal prison and a fine up to $250,000. Beall commended the FBI and Assistant U.S. Attorney Sheri Catania for their work on the case.
Leader of Chicago Street Gang Sentenced to 22 Years in Federal Prison for Dealing Guns and Drugs on West SideRead the Press Release
CHICAGO — A convicted felon who was a leader of the violent Gangster 2-6 Nation street gang has been sentenced to 22 years in prison on federal gun and drug charges.
A federal jury in 2015 convicted FRANCISCO MASIAS of selling cocaine and illegally possessing 16 handguns. Masias, who had previously been convicted of a felony, illegally acquired the guns from an associate. Masias then gave the guns to JOSE MALDONADO, a fellow gang member who in turn provided them to another gang member. Law enforcement seized the firearms before they could be further distributed.
Masias, Maldonado and more than 15 other defendants have been convicted as part of a joint federal, state and local investigation dubbed “Operation Shady Business.” The gang’s drug and gun activities were uncovered through the use of wiretaps, cooperating witnesses and surveillance. The probe was initiated by the Chicago Police Department and conducted under the umbrella of the U.S. Organized Crime Drug Enforcement Task Force (OCDETF), with assistance from the High Intensity Drug Trafficking Area Task Force (HIDTA).
U.S. District Judge Rebecca R. Pallmeyer imposed the 264-month sentence for Masias on Friday in federal court in Chicago.
The sentence was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Eddie Johnson, Superintendent of the Chicago Police Department; Dennis A. Wichern, Special Agent in Charge of the Chicago Field Division of the Drug Enforcement Administration; and James D. Robnett, Special Agent-in-Charge of the Chicago Office of the Internal Revenue Service Criminal Investigation Division. The Cook County State’s Attorney’s Office and the U.S. Marshals Service provided valuable assistance.
Masias, 38, of Berwyn, was a longtime leader of the Gangster 2-6 Nation, which operated a violent drug-trafficking organization on the West Side of Chicago, predominantly in the Little Village area. Evidence at trial revealed that the gang violently protected its distribution of cocaine. During the investigation officers searched a Nottingham Park residence that had been converted into a marijuana grow house and seized more than 100 marijuana plants, which had an estimated street value of $1 million. JASON HERRERA, who resided at the grow house and served as security, pleaded guilty to a drug charge and was sentenced to five years in prison.
A jury convicted Maldonado, of Chicago, on gun and drug charges, and he was sentenced to 22 years in prison.
The government is represented by Assistant U.S. Attorneys Matthew F. Madden and Ankur Srivastava.
Lawton Tax Return Preparer to Serve 18 Months in Prison for Earned Income Credit Tax Fraud SchemeRead the Press Release
Oklahoma City, Oklahoma – LAQUINTA Q. FISHER, a former tax return preparer from Lawton, Oklahoma, was sentenced to serve 18 months in federal prison for an earned income credit tax fraud scheme involving false reporting of income and dependents, announced Mark A. Yancey, United States Attorney for the Western District of Oklahoma.
According to an indictment on August 17, 2016, Fisher was a self-taught tax return preparer who prepared federal tax returns for individuals in the Lawton, Oklahoma, area for tax years 2010 through 2014. She recruited clients by word of mouth and by distribution of flyers. Fisher advised her clients that all they needed was a dependent child in order to receive a refund from the government. She then falsified returns for clients by adding fictitious income to increase the earned income credit (EIC) and by adding false dependents to maximize the EIC, which resulted in false refund claims. Fisher prepared and submitted the returns for her clients electronically to the IRS.
Fisher pled guilty on October 5, 2016. Today, she was sentenced by United States District Judge David Russell to serve 18 months in federal prison, followed by three years of supervised release. She was also ordered to pay $133,955 in restitution to the IRS. Reference is made to court filings for further information.
This case is the result of an investigation by IRS-Criminal Investigations and was prosecuted by Assistant U.S. Attorney Rozia McKinney-Foster.
Justice Department Seeks to Stop Florida Tax Return Preparer from Preparing Federal Tax ReturnsRead the Press Release
A Broward County, Florida tax return preparer, Billy Philippe, unlawfully understates his customers’ income tax liabilities and overstates refunds by making deliberate misstatements on the tax returns, according to a new civil lawsuit filed by the Justice Department today. The suit, filed in federal court in Fort Lauderdale, asks the court to permanently bar Philippe from preparing federal tax returns for others. The suit also asks the court to order Philippe to turn over a list of all the tax returns he has prepared since Jan. 1, 2012.
The complaint alleges that Philippe, the majority owner of Advantage Tax Center Plus Inc., prepares federal income tax returns for customers that fraudulently overstate the amount of the refunds due by falsely claiming refundable credits, including the Earned Income Tax Credit (EITC) and credits for education expenses. The complaint further alleges that Philippe frequently claims fraudulently inflated wages or self-employment income in order to maximize the amount of EITC a customer claims. The IRS previously penalized Philippe over $24,000 for failure to exercise the due diligence required to claim the EITC for his customers and the failure to properly identify himself as the paid return preparer, according to the complaint.
From 2011 to 2015, Philippe prepared at least 899 returns, according to the complaint. The complaint alleges that audits of 44 returns prepared by Philippe in 2014 and 2015 revealed that he claimed credits his customers were not entitled to take and/or understated their correct tax liability by more than $300,000 in the aggregate.
The IRS is reminding taxpayers that the 2017 individual income tax return filing season begins today, Jan. 23, 2017, and there is information available on the IRS’s website. Return preparer fraud was one of the IRS’s Dirty Dozen Tax Scams for 2016 and taxpayers seeking a return preparer should remain vigilant. The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
HSI Investigation Shuts Down Heroin Trafficking OperationRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, and Matthew J. Etre, Special Agent in Charge of Homeland Security Investigations (HSI) in Boston, today announced the five individuals were arrested over the weekend in Hartford and charged with federal heroin trafficking offenses.
As alleged in the criminal complaint, on October 21, 2016, the Baldwin County Sheriff’s Office in Alabama conducted a motor vehicle stop of a car hauler that was carrying a 2012 Chevrolet Malibu. A search of the Malibu revealed that it contained a hidden compartment (“trap”), which is commonly used to conceal and transport illegal contraband, including narcotics, firearms and currency. The investigation revealed that the car was registered to ONEL ARANA-GERVACIO.
The complaint further alleges that law enforcement officials obtained court authorization to install tracking devices on the vehicle and, between October 2016 and January 2017, HSI agents observed it at various locations in Connecticut and Rhode Island. On January 17, agents located the vehicle at 1091 Maple Avenue in Hartford. On January 20, surveillance officers observed activity on another vehicle located at the Maple Avenue residence consistent with manipulating a mechanical hidden compartment. Officers then observed ARANA placing two duffel bags into that second vehicle and then driving off in the vehicle with MODESTO BARETT-MEDINA. At approximately 8:30 p.m., a Hartford Police cruiser pulled the car over. The vehicle also contained a hidden trap, but a search revealed no contraband.
ERISON PERALTA, LUZ CRUZ and her daughter, CAROL AMPARO, were then located inside of 1091 Maple Avenue. The complaint alleges that a search of the residence revealed at least six kilograms of heroin, approximately 500 grams of cocaine and a “finger press,” which is used to process bulk quantities of heroin into 10-gram-bags known as “fingers.” Agents also seized drug distribution materials, including sifters, grinders, scales, vacuum sealers and kilo wrappers, which were coated in heroin residue and field-tested positive for the presence of fentanyl. Agents then searched the Malibu, which was located in the garage of 1091 Maple Avenue, and recovered approximately $260,000 in cash from inside the trap.
The complaint charges ARANA, BARETT, PERALTA, CRUZ and AMPARO with possession with intent to distribute one kilogram or more of heroin, and conspiracy to possess with intent to distribute, and to distribute, one kilogram or more of heroin. Both offenses carry a mandatory minimum term of imprisonment of 10 years and a maximum term of imprisonment of life.
CRUZ and AMPARO are also charged with maintaining a drug-involved premises, an offense that carries a maximum term of imprisonment of 20 years.
The five defendants appeared today before U.S. Magistrate Judge Donna F. Martinez in Hartford. ARANA, 39, a citizen of Mexico; BARETT, 47, a citizen of the Dominican Republic, and PERALTA, 39, a citizen of the Dominican Republic, were ordered detained.
CRUZ, 46, and AMPARO, 20, were released on $50,000 bonds.
U.S. Attorney Daly stressed that a criminal complaint is only a charge and is not evidence of guilt. The defendants are entitled to a fair trial at which it is the government’s burden to prove guilt beyond a reasonable doubt.
This matter is being investigated by Homeland Security Investigations (HSI), the Hartford Police Department and the Connecticut State Police, with the assistance of the Baldwin County (Ala.) Sheriff’s Office. The case is being prosecuted by Assistant U.S. Attorney Michael J. Gustafson.
Grant County Man Pleads Guilty to Unlawfully Possessing a .50 Caliber Machine GunRead the Press Release
EUGENE, Ore. – On Monday, January 23, 2017, Michael Ray Emry, 54, of John Day, Oregon, pleaded guilty before U.S. District Court Judge Ann Aiken to unlawful possession of a fully automatic .50 caliber machine gun that was not registered to him.
After accepting the guilty plea, Judge Aiken scheduled Emry’s sentencing hearing for April 3, 2017. Emry faces a maximum sentence of 10 years in prison, a $10,000 fine, and three years of supervised release.
According to court documents and statements made in court, on May 6, 2016, federal agents executed a search warrant on Emry’s trailer in John Day and recovered a Browning M2 machine gun with an obliterated serial number. Emry told agents that the firearm was fully automatic and could fire between 550 and 650 rounds per minute, that he had stolen it from a man in Idaho, and that he had removed the serial number prior to bringing it to Oregon.
The case was investigated by the FBI in close collaboration with the 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.
Fugitive Arrested in $200 Million Credit Card Fraud ScamRead the Press Release
NEWARK, N.J. – A New York man was arrested for his role in one of the largest credit card fraud schemes ever charged by the Justice Department, U.S. Attorney Paul J. Fishman announced.
Habib Chaudhry, 49, of Valley Stream, New York, was initially charged by complaint in February 2013 and then by indictment in September 2013. Chaudhry has been a fugitive for nearly four years. He is expected to make his initial appearance later today before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court.
According to documents filed in this case and statements made in court:
Chaudhry was indicted as part of a conspiracy – led by Tahir Lodhi, Babar Qureshi, Ijaz Butt, and others – to fabricate more than 7,000 false identities to obtain tens of thousands of credit cards. Since then, 19 people, have pleaded guilty in connection with the scheme.
The scheme involved a three-step process in which the defendants would make up a false identity by creating fraudulent identification documents and a phony credit profile with the major credit bureaus; pump up the credit of the false identity by providing bogus information about that identity’s creditworthiness; then borrow or spend as much as they could without repaying the debts. The scheme caused more than $200 million in confirmed losses to businesses and financial institutions.
The scope of the criminal fraud enterprise required the conspirators to construct an elaborate network of false identities. Across the country, the conspirators maintained more than 1,800 “drop addresses,” including houses, apartments and post office boxes, which they used as the mailing addresses for the false identities.
U.S. Attorney Fishman credited special agents of the FBI’s Cyber Division, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading the charges. He also thanked postal inspectors with the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge James V. Buthorn, Newark Division, special agents of the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt, and the U.S. Social Security Administration for their assistance.
The government is represented by Assistant U.S. Attorneys Zach Intrater and Daniel Shapiro of the U.S. Attorney’s Office Economic Crimes Unit, as well as Assistant U.S. Attorney Barbara Ward, Acting Chief of the Asset Forfeiture and Money Laundering Unit.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
Former office manager of Mountain State Justice pleads guilty for embezzling over $1.5 millionRead the Press Release
CHARLESTON, W.Va. – A former office manager at Mountain State Justice who embezzled over $1.5 million pleaded guilty today, announced United States Attorney Carol Casto. Kim Cooper, 55, of St. Albans, entered her guilty plea to wire fraud and tax evasion.
Cooper began working in the late 1990’s in the Charleston office of Mountain State Justice, Inc., a non-profit organization that provides legal services for indigent and low-income West Virginia residents in civil cases. Cooper became the office manager and her duties included overseeing the daily operations of the Charleston office and making deposits of checks in Mountain State Justice’s bank accounts.
Cooper admitted that she opened a money market account at WesBanco Bank in the name of Mountain State Justice, which no one else at Mountain State Justice knew about. Cooper admitted that in late June 2004, she began stealing checks made out to Mountain State Justice that were payment for attorneys’ fees and depositing these checks in the secret bank account. Cooper also admitted that she wrote checks from the secret account to a close family member with notations that made the payments appear legitimate. Cooper additionally admitted that she endorsed those checks, deposited the checks in another account, and used the money to pay rent, make car payments, make credit card payments, and pay for personal expenses.
Cooper further admitted that she hid her crime by omitting these stolen checks from the cash log used to record all incoming monies and by hiding all incoming mail from WesBanco. Cooper perpetuated this fraud by sending false income statements to the board of directors of Mountain State Justice that underreported the income of the organization. Cooper also admitted that she attempted to evade income tax she owed on this embezzled money. Cooper’s scheme ended in late March 2016 when she was interviewed by federal law enforcement agents and her employment was terminated.
Cooper faces up to 25 years in federal prison when she is sentenced on April 20, 2017. As part of her plea agreement, Cooper agreed to pay restitution of $1,462,023.83 to Mountain State Justice and $377,776.89 to the United States.
The FBI and the IRS - Criminal Investigation division conducted the investigation. First Assistant United States Attorney Philip H. Wright is in charge of the prosecution. The plea hearing was held before United States District Judge John T. Copenhaver, Jr.
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Former Greenwich Resident Who Stole More Than $700K in Fraud Scheme Sentenced to 4 Years in Federal PrisonRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that, on January 20, DEBRA BIAGI, 50, of Fogelsville, Pa., formerly of Greenwich, was sentenced by U.S. District Judge Jeffrey Alker Meyer in New Haven to 48 months of imprisonment, followed by three years of supervised release, for stealing more than $700,000 from her employer and related companies and individuals.
According to court documents and statements made in court, BIAGI was employed by HB Nitkin Group of Greenwich, a privately owned business engaged in real estate management and development. BIAGI served as an assistant to the chairman of the company with responsibilities that included managing the accounts payable for the company.
From approximately February 2014 to December 2015, BIAGI defrauded the company, as well as key company individuals and members of their families who retained financial and banking information at the company. As part of the scheme, BIAGI created fraudulent invoices made out to fictitious companies detailing charges for items such as masonry, carpentry, electrical and plumbing work. She then used victims’ checkbooks to make checks out to the fictitious companies, purportedly to pay the fraudulent invoices. BIAGI then deposited the checks into her personal bank account, at times endorsing the check with an illegible signature to hide her misconduct, and subsequently withdrew the monies for her personal use.
To keep track of which invoices were fictitious and which checks were made to fictitious companies, BIAGI often included her initials “DB” in the fabricated company name listed on the invoice and check. BIAGI then noted the fictitious company as the payee in the relevant accounting records at the company and filed the fabricated invoices as business record. BIAGI also, as needed, misappropriated the signature stamp of the company’s chairman and used it to “sign” the misappropriated checks and to falsely suggest that the paid expenditure was both legitimate and authorized.
In addition, at different times during the scheme, BIAGI simply stole checks from employees of the company and either made the checks to cash, or endorsed to cash checks that already listed a payee.
In total, BIAGI stole $711,074.39 during the course of this scheme.
Judge Meyer ordered BIAGI to make full restitution.
On August 26, 2016, BIAGI pleaded guilty to one count of wire fraud.
This matter was investigated by the Federal Bureau of Investigation and Greenwich Police Department, and was prosecuted by Assistant U.S. Attorney Christopher W. Schmeisser.
Former Des Moines Man Sentenced to Prison for Bank RobberyRead the Press Release
DES MOINES, IA – On January 23, 2017, Robert Dwayne Humburd IIIheather Jean Reekr, age 38, formerly of Des Moines, Iowa, was sentenced by Senior United States District Court Judge James E. Gritzner to 96 months in prison for two counts of bank robbery, announced United States Attorney Kevin E. VanderSchel. Humburd is required to serve a three-year term of supervised release following his prison term, pay $200 to the Crime Victims’ Fund, and pay a total of $10,473 in restitution to the banks and a bank teller. The Court ordered the prison terms on each count are to be served at the same time.
On September 21, 2016, Humburd pleaded guilty to two counts of bank robbery. According to the plea agreement, Humburd entered a U.S. Bank branch in Des Moines on September 9, 2015, and gave a note to the teller demanding cash. Humburd fled the bank with a sum of cash. On November 6, 2015, Humburd entered a Bankers Trust Company branch in Des Moines and handed a note to the teller demanding cash. Again, Humburd fled the bank with a sum of cash.
This matter was investigated by the Des Moines Police Department and the case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
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Learn more about this release by contacting Rachel Scherle at 515-473-9300, or by emailing her at [email protected]
Former Correctional Officer Pleads Guilty to Having Illegal Sexual Contact with an Inmate and is Sentenced to 60 Months of ProbationRead the Press Release
Oklahoma City, Oklahoma – AMANDA HOCK, 35, of Kingsland, Georgia, pled guilty today to having illegal sexual contact with an inmate at the Federal Correctional Institution in El Reno, Oklahoma ("FCI-El Reno"), announced Mark A. Yancey, United States Attorney for the Western District of Oklahoma. United States District Judge Stephen P. Friot also sentenced Hock to five years of probation.
Hock was a Correctional Officer at FCI-El Reno until her resignation in December 2015. She was charged on September 13, 2016, with knowingly engaging in sexual contact with B.C., an inmate at FCI-El Reno, in violation of 18 U.S.C. § 2244(a)(4). At the hearing before Judge Friot today, Hock admitted to engaging in the sexual contact with the inmate on December 23, 2015. Following her guilty plea, Judge Friot sentenced Hock to 60 months’ probation, with 180 days of that sentence to be served on home detention. She was also ordered to complete 104 hours of community service within her first year of probation.
Federal law criminalizes all sexual relations and sexual contact between prison staff and inmates. See 18 U.S.C. §§ 2241, 2243, and 2244. An incarcerated individual has the right to not be pressured by anyone to engage in sexual acts and does not have to tolerate sexually abusive behavior or pressure to engage in unwanted sexual behavior from another inmate or staff member. In addition to the harm it causes to inmates, staff sexual abuse of inmates can also threaten the safety and security of the prison.
This case is the result of an investigation conducted by the U.S. Department of Justice Office of the Inspector General and the Federal Bureau of Investigation. It was prosecuted by Assistant U.S. Attorney Julia Barry.
Former Bangor Resident Sentenced to Five Years for Crack DistributionRead the Press Release
Contact: Joel B. Casey
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Wendell White, 52, of Rumford, Maine, and formerly of Bangor, was sentenced today in U.S. District Court by Judge John A. Woodcock, Jr. to five years in prison and three years of supervised release for conspiring to distribute cocaine base, commonly known as “crack.”
According to court records, the defendant joined a conspiracy that operated between about January 2010 and August 2013 and that acquired crack in New Haven, Connecticut and distributed almost a kilogram of it in Penobscot County and elsewhere. The defendant distributed and sold half-gram and gram quantities of crack throughout the Bangor area for $50 and $100, respectively, for Christian Turner, a/k/a “P” and Rodrigo Ramirez, a/k/a “Rico.” He also allowed Turner, Ramirez and others to use his Sanford Street, Bangor apartment -- where he and his three-year old son lived -- as a place where crack could be sold and used. Members of the conspiracy from New Haven included members of the Red Side Guerilla Brims, a violent street gang affiliated with the Almighty Blood Nation, a national street gang.
The case was investigated by the Maine Drug Enforcement Agency and the New Haven, Connecticut Office of Bureau of Alcohol, Tobacco, Firearms and Explosives, and the City of New Haven Department of Police Services.
Fmr. RI House Finance Chairman to Plead Guilty to Fraud, Aggravated Identity Theft, Tax ChargesRead the Press Release
PROVIDENCE – According to signed documents filed in U.S. District Court in Providence today, Raymond E. Gallison, Jr., 64, of Bristol, R.I., a former member of the Rhode Island House of Representatives and House Finance Committee Chairman, has agreed to plead guilty to federal mail fraud, wire fraud, aggravated identity theft and filing false tax return charges.
According to signed court documents, Gallison will admit to wide-ranging fraudulent and deceptive conduct to steal private money and hide his misuse of public money, and covering his tracks while doing so. Gallison will admit to the theft of funds from the estate of a deceased individual to which he was appointed executor; theft of funds from a Special Needs Trust established to protect the long-term welfare of a disabled individual to which he was appointed trustee; providing false information on tax documents, including vastly inflating the number of students assisted by a non-profit organization funded by public money while failing to disclose amounts paid by that organization to him; and failure to pay taxes on income derived from his criminal actions.
United States Attorney Peter F. Neronha and Rhode Island Attorney General Peter F. Kilmartin today announced the filing of a federal Information charging Raymond E. Gallison, Jr., with four (4) counts of mail fraud; one (1) count of wire fraud; one (1) count of aggravated identity theft; one (1) count of aiding the filing of a false tax document; and two (2) counts of filing a false tax return. According to a Plea Agreement filed in this matter, Gallison will serve, at a minimum, two years in federal prison.
According to signed documents filed with the Court, Gallison will admit that:
As executor of an estate of an individual from Barrington, R.I., who passed away in February 2012, he devised and executed various schemes to steal or transfer to his own name and bank accounts, cash, checks, stocks and real property belonging to the deceased person and/or his estate, valued at a total of $677,957.06. Gallison will admit that he fraudulently used the name and social security number of the deceased person to execute a scheme to cause the liquidation of certain stocks belonging to the deceased person;
He caused the filing of a false tax document on behalf of Alternative Education Programming (AEP), a non-profit organization which provided educational programs to students who may need assistance with course work, and/or minority and/or disadvantaged students who may need financial or other assistance to gain an education, and of which Gallison was listed as Assistant Director. The tax document listed that $77,957 in tuition and related fees and expenses were paid for 47 students from July 1, 2012, through June 30, 2013. In fact, on behalf of AEP, Gallison paid only $3,137.29 to assist 2 students during that year and paid approximately $64,575 to himself and another person in wages and consulting fees for no work undertaken on AEP’s behalf;
As trustee for a disabled person’s Special Needs Trust, he defrauded the Trust by writing a check from the Trust account for $8,900, which he deposited into an AEP account. Gallison then wrote a check for $8,800 from the AEP account to pay an outstanding bill at the Community College of Rhode Island; and
He failed to claim a total of $622,286.17 in income on joint IRS tax returns for tax years 2012 and 2013, and, as a result of his relevant conduct from 2012-2015, Gallison failed to pay a total of $226,332.31 in taxes.
An information is merely an allegation 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.
Joining United States Attorney Peter F. Neronha and Rhode Island Attorney General Peter F. Kilmartin in announcing the filing of an information and plea agreement in this matter are Harold H. Shaw, Special Agent in Charge of the FBI Boston Division; Joel P. Garland, Special Agent in Charge, Internal Revenue Service Criminal Investigation; and Colonel Ann C. Assumpico, Superintendent of the Rhode Island State Police.
The matter was investigated by the United States Attorney’s Office, FBI, Internal Revenue Service Criminal Investigation, Rhode Island Department of the Attorney General, and the Rhode Island State Police.
The case is being prosecuted in federal court by Assistant U.S. Attorneys Dulce Donovan and William J. Ferland, and Special Assistant U.S. Attorney James R. Baum of the Rhode Island Department of the Attorney General.
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Contact:
Jim Martin (401) 709-5357
email: [email protected]
on Twitter @USAO_RI
Essex County, New Jersey, Man Admits That He Exchanged over $840,000 in ‘Snap’/Food Stamp Benefits for CashRead the Press Release
TRENTON, N.J. – An Irvington, New Jersey, man today admitted that he stole more than $840,000 from the U.S. Government through a scheme to exchange food stamps for cash, U.S. Attorney Paul J. Fishman announced.
Miguel Antonio Azcona, a/k/a “Miguel A. Azcona-Peralta,” 38, pleaded guilty before U.S. District Judge Mary L. Cooper in Trenton federal court to an information charging him with one count of theft of government funds.
According to documents filed in this case and statements made in court:
Azcona was the owner of New Community Supermarket on Springfield Avenue in Newark, New Jersey. New Community Supermarket was a small grocery that was authorized to accept Supplemental Nutrition and Assistance Program (SNAP) benefits (formerly known as food stamps). Azcona controlled a business bank account for New Community Supermarket to receive the reimbursements for SNAP benefits.
Azcona knew that as a SNAP retailer, he was not allowed to exchange food stamps for cash. Yet from August 2014 through Aug. 11, 2016, Azcona and others, including employees under his supervision, unlawfully redeemed SNAP benefits in exchange for cash rather than food. In return for exchanging SNAP benefits for cash, New Community Supermarket retained a portion of the transaction’s value for Azcona’s benefit.
At his plea hearing, Azcona admitted that his conduct resulted in losses of approximately $840,583.54.
The count of theft of government funds carries a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is set for May 3, 2017.
U.S. Attorney Fishman credited special agents of the U.S. Department of Agriculture, Office of Inspector General, under the direction of Special Agent in Charge Bethanne M. Dinkins in New York; and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Terence S. Opiola.
The government is represented by Assistant U.S. Attorney Elaine K. Lou of the Criminal Division in Newark.
Defense counsel: David R. Oakley, Esq.
Elyria man indicted for tampering with hearingRead the Press Release
An Elyria man was indicted on one count of tampering with an official proceeding, said U.S. Attorney Carole S. Rendon.
Micah Jackson, 20, attempted to influence two federal witnesses to retract their previously sworn testimony on Nov. 9, 2016, according to the indictment.
The witnesses’ testimony was given at a supervised release violation hearing before a U.S. District Court judge. The defendant in the supervised release hearing was related to Jackson. Jackson attempted to influence each witnesses’ testimony by posting their pictures on Facebook with rat emojis above the witnesses’ faces, with the intent that each witness would change their previously sworn testimony, according to the indictment.
If convicted, the sentence in this case will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique 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.
The case is being prosecuted by Assistant U.S. Attorney Benedict S. Gullo. The case was investigated by the United States Marshals Service and the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
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.
EOIR Statement on Erroneous Public Release of Immigration Judge InformationRead the Press Release
FALLS CHURCH, Va. – The Executive Office for Immigration Review is a party to litigation related to the release of information regarding its immigration judge conduct and professionalism program. EOIR is committed to ensuring that any allegation of an immigration judge’s misconduct is investigated and resolved in a fair and expeditious manner, consistent with federal personnel and privacy laws and regulations that apply to non-supervisory, career civil servants.
During this still-active litigation, the plaintiff, the American Immigration Lawyers' Association, posted to the Internet the 16,000 documents that EOIR provided. These documents were released pursuant to a court order. A private attorney then took the time to manipulate some of the documents in order to uncover data not accessible on the face of the documents themselves, and post his personal assessment of the metadata contained therein.
EOIR believes the attorney, upon finding information was inadvertently provided, should have promptly notified the sender (EOIR) rather than taking steps to publish guesses. This unfortunate incident resulted in the attorney publishing a "key" to the documents. EOIR has determined that the “key” is inaccurate and does not correctly present the actual details associated with the documents. It is instead a representation of one person’s assumptions based on his own manipulations of the text, which resulted in the errors.
Individuals who file complaints about immigration judges are not bound to keep private the details of their complaint. EOIR will continue to defend its case in the referenced FOIA litigation, and remains committed to protecting the identities of the immigration judges against whom complaints, some substantiated and some unsubstantiated, have been filed.
It is unfortunate that some members of the agency’s highly talented and professional immigration judge corps have been negatively and falsely named in the private attorney’s action, and that he chose to publish his erroneous findings without any way of verifying his information.
Duncan Pharmacy to Pay $50,000 to Settle Claims Involving Violations of the Controlled Substances ActRead the Press Release
Oklahoma City, Oklahoma – R&S Drug Stores, Inc. ("R&S Drug"), an Oklahoma corporation which operates three retail pharmacies in Duncan, Oklahoma, has paid $50,000 in civil penalties to the United States to settle claims stemming from alleged violations of the Controlled Substances Act, announced Mark A. Yancey, United States Attorney for the Western District of Oklahoma.
The Controlled Substances Act, 21 U.S.C. Sections 801 et seq. ("CSA"), was passed by Congress to combat the illegal distribution and abuse of controlled substances, including prescription medications. The CSA is enforced by the Drug Enforcement Administration's (DEA) Office of Diversion Control, whose mission is to prevent, detect, and investigate the diversion of controlled pharmaceuticals and listed chemicals from legitimate sources while ensuring an adequate and uninterrupted supply for legitimate medical, commercial, and scientific needs. Under the CSA, entities registered with the DEA who purchase, distribute, dispense, transfer, or sell controlled substances must comply with inventory and documentation requirements. Regulations promulgated under the CSA require that each DEA registrant, including pharmacies, maintain complete and accurate records of each substance manufactured, received, sold, delivered, dispensed or otherwise disposed of by the registrant for two years. These requirements play a vital role in ensuring the appropriate handling, accounting, and distribution of controlled substances.
The United States alleged that between August 1, 2014, and August 31, 2016, R&S Drug violated federal law by transferring controlled substances between stores without the proper documentation, failed to conduct and maintain a biennial inventory, failed to execute powers of attorney authorizing pharmacists to issue orders for Schedule I and II controlled substances on behalf of R&S Drug (the registrant), and failed to dispense controlled substances under the correct practitioner’s name and DEA registration number.
In order to resolve the claims by the United States, R&S Drug paid $50,000 in civil penalties to the government. In reaching this settlement, R&S Drug did not admit liability and the government did not make any concession regarding the legitimacy of its claims. The agreement allows the parties to avoid the delay, expense, inconvenience, and uncertainty involved in litigating the case.
This case was investigated by the Drug Enforcement Administration's Office of Diversion Control, Oklahoma City District Office Diversion Group, and was prosecuted by Assistant U.S. Attorney Ronald R. Gallegos.
Drug Conspiracy Leader Sentenced to More Than 25 Years in PrisonRead the Press Release
CHARLOTTE, N.C. – Alex Lenard McCoy, 32, of Gastonia, N.C. was sentenced today to 310 months in prison on a federal drug conspiracy charge and a supervised release violation, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, Chief U.S. District Judge Frank D. Whitney also ordered McCoy to serve five years under court supervision after he is released from prison.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division; Nick Annan, Special Agent in Charge of ICE/Homeland Security Investigations (HSI) in Georgia and the Carolinas; and Chief Robert C. Helton of the Gastonia Police Department join U.S. Attorney Rose in making today’s announcement.
According to filed court documents and today’s sentencing hearings, from 2011 to June 2015, McCoy and co-defendants Mickey Burris, Rodney Moore, and Eric Briggs operated as a drug conspiracy, selling crack cocaine in Gaston County and elsewhere. Court records indicate that McCoy was the leader of the drug conspiracy and engaged in drug trafficking activity while he was on federal supervision for a previous drug conviction. Court records also show that McCoy maintained a residence for purposes of drug trafficking and was responsible for the trafficking of more than a kilogram of crack cocaine. At the time of his arrest, law enforcement seized from McCoy $7,157 in drug proceeds. McCoy pleaded guilty in June 2016 to one count of drug trafficking conspiracy.
McCoy’s co-defendants were previously sentenced as follows: Mickey Burris was sentenced to 120 months in prison and five years of supervised release; Rodney Moore was sentenced to 51 months in prison and four years of supervised release; and Eric Briggs was sentenced to six months in prison and two years of supervised release.
McCoy will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentencings are served without the possibility of parole.
The prosecutions are the result of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
The investigation was led by FBI, HSI, and Gastonia PD. Assistant United States Attorney Steven R. Kaufman of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Detroit One Collaboration Leads to Five Guilty Pleas for Latin Count Gang Members on Racketeering ChargesRead the Press Release
Detroit One collaboration of local, state and federal law enforcement has led to the guilty pleas of five Latin Counts street gang members for racketeering conspiracy involving murder and drug trafficking, U.S. Attorney Barbara L. McQuade announced today.
The pleas were unsealed today and occurred during the past week in federal court in Ann Arbor. All five defendants pleaded guilty to racketeering conspiracy, and each faces 30 years in prison. The five gang members are:
- Devin Dantzler, 21, of Ecorse;
- Victor Vasquez, 26, of Detroit;
- Jonathan Estrada, 27, of Lincoln Park;
- Jesus Rodriguez, 25, of Lincoln Park; and
- Angel Rodriguez, 21, of Lincoln Park.
According to the racketeering indictment, the Latin Counts gang operates in southwest Detroit and the downriver communities of Lincoln Park and Ecorse. The indictment alleges that 11 defendants committed assaults, murder, trafficking in drugs and stolen firearms, robbery and breaking and entering homes and businesses. The indictment alleges that the gang uses violence to stake out its “turf” and to intimidate both rival gang members and the citizens of southwest Detroit.
As part of their guilty pleas, Dantzler and Victor Vasquez took responsibility for causing the death of Mustafa Al-Yasiry at the Big Apple Market in southwest Detroit on April 18, 2014. According to the indictment, several Latin Counts assaulted Al-Yasiry, and Dantzler shot and killed him. Three other gang members have already pleaded guilty for their roles in this murder. Similarly, as part of their pleas, Estrada and the two Rodriguez brothers took responsibility for participating in the killing of Terrence McClearen and the shooting of another victim on August 18, 2013.
Under the Detroit One Initiative, and through the lead efforts of the Detroit Police Department and the FBI Violent Crime Task Force, which consists of representatives of Homeland Security Investigations, Detroit Police Department, Lincoln Park Police Department, Michigan Department of Corrections, and Michigan State Police, investigators were able to merge separate probes of various members of this organization and its activities into one encompassing investigation.
“By working together, the Detroit One partners are systematically dismantling the street gangs that cause violent crime in our neighborhoods,” McQuade said. “We want to take back our streets from violent gangs so that Detroit residents can enjoy the safe quality of life that we all deserve.”
“The success of the Detroit One initiative is evident in the continued disruption, arrest and prosecution of these violent gang members in our communities” said Chief James Craig. “The collaboration of law enforcement agencies certainly plays a key role in returning the neighborhoods back to the people.”
“These guilty pleas demonstrate law enforcement's resolve to stopping the escalating violence linked to gang activity”, stated HSI Acting Special Agent in Charge Steve Francis. "Removing criminal gang members from the streets will ensure that they are no longer in a position to wreak havoc in our neighborhoods and threaten the public's safety."
"Once again, the Detroit One Initiative and its ongoing dynamic law enforcement collaborations have proven highly effective in combating some of the most violent and heinous criminals in our community”, said David P. Gelios, Special Agent in Charge, FBI Detroit Division. "Success, in these cases, is a direct result of ongoing joint investigative efforts like this led by the FBI’s multi-agency Violent Gang Task Force, which is comprised of federal, state and local law enforcement agencies. It is through these joint ventures and the Detroit One Initiative we are routinely and effectively force multiplying by leveraging resources to help keep our neighborhoods and communities safe from the threats gang violence poses to our citizens”.
Detroit One is a collaborative effort between law enforcement and the community to reduce homicide and other violent crime in Detroit. By working together, local, state, and federal law enforcement agencies strive to maximize their ability to identify and arrest individuals and groups initiating violence in Detroit. Since its launch in 2013, homicides are down 20% and non-fatal shootings are down 25% in the City of Detroit. A comparison between the four-year period since Detroit One began with the prior four-year period shows 174 fewer homicides in the city.
These pleas are the latest in a string of charges from the U.S. Attorney’s Office and Wayne County Prosecutor’s Office during the last four years involving violent street gangs in the city of Detroit, including:
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19 members/associates of the Seven Mile Blood street gang for federal racketeering conspiracy and other violent acts in furtherance of racketeering;
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Nine members of the Bounty Hunter Bloods street gang for federal racketeering conspiracy and other violent acts in furtherance of racketeering;
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14 members of the Phantom Outlaw Motorcycle Club/Vice Lords street gang for federal racketeering conspiracy and other violent acts in furtherance of racketeering;
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Four Vice Lord members in state court for armed robbery and a Vice Lord leader charged under the federal street gang statute for his role in that armed robbery;
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Nine Vice Lords members for racketeering charges stemming from the shooting of four individuals at their family residence on Detroit’s northwest side;
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Three members of the Band Crew street gang charged under the state of Michigan gang felony statute for violent acts in furtherance of their gang activities and eight members of the Band Crew for federal racketeering conspiracy and other violent acts in furtherance of racketeering;
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10 members of the RTM street gang for federal racketeering conspiracy and other violent acts in furtherance of racketeering;
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11 members of the 6 Mile Chedda Grove street gang for federal racketeering conspiracy and other violent acts in furtherance of racketeering;
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14 members of the Rollin’ 60s Crips street gang for federal racketeering conspiracy and other violent acts in furtherance of racketeering;
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Four members of the Band Gang street gang charged under the state of Michigan gang felony statute for violent acts in furtherance of their gang activities and three members of the Band Gang for federal access device fraud/ aggravated identity theft and one member of the same gang charged in federal court with being a felon in possession of a firearm;
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24 individuals on drug conspiracy charges for their use of sixteen different houses in the east side Ravendale neighborhood of Detroit, many of them abandoned homes, for distributing heroin, cocaine, and crack cocaine between 2013 – 2015; and
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14 individuals on federal charges of criminal enterprise, drug distribution or weapons offenses for drug distribution in the west side Warrendale neighborhood of Detroit.
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Derry Man Pleads Guilty to Conspiracy Charges Related to Sales of Synthetic CannabinoidsRead the Press Release
CONCORD, N.H. – United States Attorney Emily Gray Rice announced today that Tony Aoude, 45, of Derry, New Hampshire pleaded guilty to conspiracy charges related to the sales of synthetic cannabinoid products.
Aoude pleaded guilty to Conspiracy to Violate the Travel Act and Conspiracy to Receive Misbranded Products. According to court documents and statements in court, in 2013 and 2014, Aoude sold synthetic cannabinoid products at stores that he operated in Londonderry and Hooksett, New Hampshire. These products contained XLR11 and AB-FUBINACA, which are illegal controlled substances. The products were sold in packages with false and misleading labels that stated that the products were “not for human consumption” or were “legal in 50 states.” Despite being aware that the products were intended for human consumption, he sold various forms of the product that bore multiple labels, including “Toxic Blue Magic” and “Caution Platinum.”
During the course of a law enforcement investigation, undercover officers asked to purchase quantities of these products for resale in Florida. Despite being told by a co-conspirator (Robert Costello) that the products were unlawful in Florida, Aoude arranged for the undercover officers to purchase the drugs at his store in Londonderry. He also received payments for facilitating the shipment of additional products to Florida.
Sentencing for Aoude has been scheduled for May 4, 2017.
This investigation led to the arrest and prosecution of multiple individuals. Costello, who provided synthetic cannabinoids to Aoude, is serving a 60-month federal prison sentence. Kyle Hurley, who arranged to manufacture and distribute these drugs, is serving a 114-month prison sentence.
Synthetic cannabinoids are green leafy materials that have been sprayed with chemicals. These products (commonly referred to as “spice” or “K2”) are often marketed as incense or potpourri. As in this case, the packaging materials often contain attractive logos that are designed to appeal to young people. Although the products are often identified as “not for human consumption,” the products are smoked in order to obtain a high. The chemicals that are sprayed on the products to produce the high are often illegal controlled substances or analogues of illegal controlled substances. The ingestion of these types of illegal products has caused some users to experience a variety of medical side effects and has led to numerous hospitalizations.
“There is a misconception that synthetic cannabinoids, known on the street as synthetic marijuana, K2, and spice, are safe. Synthetic cannabinoids are anything but safe,” said DEA Special Agent in Charge Michael J. Ferguson. “They are a toxic cocktail of lethal chemicals with serious health and safety risks. This investigation represents local, state and federal law enforcement’s efforts to combat this emerging public threat.”
U.S. Attorney Rice agreed, saying, “while we are in the midst of an opioid epidemic, some individuals may believe that synthetic cannabinoids are a safe alternative for those looking to get high. These products are far from safe. They are made in highly unsanitary conditions and users have no idea what potentially deadly chemical may be inside these glossy packages. This packaging can give consumers a false sense of security about using a product that could harm or kill them.”
This case was supported by the Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. The Drug Enforcement Administration’s Tactical Diversion Squad led the investigation in collaboration with the US Postal Inspection Service and Homeland Security Investigations. The investigators also received the invaluable assistance of DEA-NH/HIDTA and DEA’s Air Wing, the New Hampshire and Massachusetts State Police, the U.S. Marshals Service, Portsmouth Police Department, Somersworth Police Department, Kingston Police Department, the Dover Police Department, the Londonderry, Police Department and the York and Kittery, Maine Police Departments. It is being prosecuted by Assistant United States Attorneys John J. Farley and Charles Rombeau.
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Defendant Sentenced to 46 Months for Sexual Abuse of a MinorRead the Press Release
Assistant U. S. Attorney Jennifer Gmitro (619) 546-9692
NEWS RELEASE SUMMARY – January 23, 2017
SAN DIEGO – Dylan Wayne Cowdrey was sentenced in federal court today to 46 months in prison for sexually abusing a 14-year-old old girl by coercing her through threatening text messages.
According to his October 2016 plea agreement, Cowdrey admitted to having sexual intercourse with the victim on a military base in the Southern District of California. He also admitted to engaging in undue influence to coerce her into the sexual acts. That is, between approximately June 5, 2016 and June 9, 2016, Cowdrey sent anonymous text messages to the victim threating to cause serious bodily harm to her family and loved ones if she did not perform sexual acts with him. Among other threats, Cowdrey stated that if the victim did not comply, she would “lose her love[d] ones and everyone else [she] knows.”
He also claimed that he was receiving threatening text messages from the same source. When the defendant met up with the victim and she told him she did not want to perform sex acts, he responded that he “didn’t want to die” as a result of her refusal. On the same day, the defendant engaged in sexual acts with the victim.
The defendant, then 22, admitted in his plea agreement he knew the victim was 14.
At sentencing, U.S. District Judge William Q. Hayes stated that the defendant’s conduct could only be described as “manipulative” and “diabolical.” Noting the youth of the victim, Judge Hayes added, “It is hard for me to understand the sense of betrayal” that the victim must feel, “to learn that all of it wasn’t true.”
“It is a despicable thing to deceive and abuse a child,” said Acting U.S. Attorney Alana W. Robinson. “This defendant will now pay a high price for striking fear in the heart of a child to the point where she believed she had to sacrifice herself to protect her family.”
DEFENDANT Criminal Case: 16CR1929-WQH
Dylan Wayne Cowdrey Age 23 San Diego, California
SUMMARY OF CHARGES
Sexual Abuse of a Minor within Maritime and Territorial Jurisdiction (18 U.S.C. § 2243(a))
Maximum penalty: 15 years in prison and $250,000 fine
AGENCY
Naval Criminal Investigative Service
Davenport Man Sentenced to Prison for Receiving Child PornographyRead the Press Release
DAVENPORT, IA – On January 23, 2017, Jacob Scott Watters, 24, of Davenport, Iowa, was sentenced by Chief United States District Court Judge John A. Jarvey to 240 months in prison for receipt of child pornography, announced United States Attorney Kevin E. VanderSchel. Watters was ordered to serve ten years of supervised release following his prison term and to pay $100 to the Crime Victims’ Fund.
Watters pleaded guilty to receipt of child pornography on August 25, 2016. According to the plea agreement, on August 18, 2014, Davenport Police Department was notified of an investigation in Merced County, California, that concluded Watters was engaging in sexual chats and sending and receiving nude pictures with a 15-year-old female. A search warrant executed at Watters’ residence led to the recovery of multiple electronic devices.
During the examination of the recovered devices, it was determined Watters was communicating with six other minor females, many of whom with he was having sexual conversations and exchanging pornographic pictures. At the time of the communications, Watters was a registered sex offender and on state probation for lascivious acts with a minor.
This matter was investigated by the Davenport Police Department and the Iowa Division of Criminal Investigations. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa as part of the Project Safe Childhood Initiative.
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Learn more about this release by contacting Rachel Scherle at 515-473-9300, or by emailing her at [email protected]
Davenport Man Sentenced for Felon in Possession of Ammunition ChargeRead the Press Release
DAVENPORT, IA - On January 23, 2017, Marcus Anthony Brown, age 27, of Davenport, Iowa, was sentenced by Chief District Court Judge John A. Jarvey to five years in prison after pleading guilty to felon in possession of a firearm, announced United States Attorney Kevin E. VanderSchel. Brown was ordered to serve three years of supervised release and pay $100 to the Crime Victims’ Fund.
On September 9, 2016, an off-duty Davenport police officer observed a fight in a parking lot. A man, later identified as Brown, fired two shots into the air from what appeared to be a handgun. As the officer approached the scene, he observed Brown get in and out of a vehicle; the vehicle left before back-up officers arrived. Officers were unable to locate a firearm, but did find and seize several rounds of .380 caliber ammunition and Brown was arrested. Brown has two prior 2005 felony convictions.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Davenport Police Department. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
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Learn more about this release by contacting Rachel Scherle at 515-473-9300, or by emailing her at [email protected]
Court Shuts Down Illinois Tax Return PreparerRead the Press Release
Today a federal court in Illinois permanently enjoined Daria Emma Valdivia, individually and doing business under the name Emma’s Agency, from preparing federal tax returns for others. Valdivia agreed to the civil injunction order entered against her, which requires her to turn over to the United States a list of all persons for whom she prepared federal tax returns since 2012. The court also authorized the United States to monitor Valdivia’s compliance with the terms of the injunction.
According to the government’s complaint, Valdivia, of Sterling, Illinois, routinely prepared federal tax returns, from her business Emma’s agency, for customers that falsely claimed unqualified individuals as dependents, such as persons who did not live in the United States or a country contiguous to the United States. The complaint alleges that Valdivia also improperly reported her customers’ filing status as Head of Household when the customers were ineligible for that status, according to the complaint. The complaint alleges that these two types of return preparer misconduct allowed Valdivia to understate her customers’ tax liabilities and claim undeserved refunds for them. According to the complaint, Valdivia continued to engage in this conduct despite the fact the Internal Revenue Service (IRS) assessed her with $132,000 in penalties for similar violations of the Internal Revenue Code. The complaint alleges that IRS audits of 65 returns prepared by Valdivia show that she underreported her customers’ tax liabilities on 89 percent (58) of them by more than $285,000, collectively.
The IRS is reminding taxpayers that the 2017 individual income tax return filing season begins Jan. 23, 2017, and there is information available on the IRS’s website. Return preparer fraud was one of the IRS’s Dirty Dozen Tax Scams for 2016 and taxpayers seeking a return preparer should remain vigilant. The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Couple Sentenced for Wire Fraud and Identity TheftRead the Press Release
G.F. “Pete” Peterman, III, United States Attorney for the Middle District of Georgia, announces that sentences were imposed upon Tamara Andreatta, age 45, and Stacy Rix, 47, both of Albany, on January 19, 2017, in Albany, GA, by the Honorable Leslie J. Abrams, District Judge for the Middle District of Georgia. Following a jury trial in September 2016, both defendants were convicted of conspiracy to commit wire fraud and seven counts of wire fraud. Ms. Andreatta was also convicted of two counts of aggravated identity theft. Ms. Andreatta was sentenced on Friday to a term of 61 months imprisonment to be followed by a term of three years supervised release. Mr. Rix was sentenced to a term of 24 months imprisonment to be followed by a term of three years supervised release. In addition, both defendants were ordered to pay restitution in the amount of $466,692.41.
The evidence at trial showed that the defendants, who lived together, were both employed at Industrial Manufacturing, an Albany business that manufactures machine parts and equipment. Ms. Andreatta was employed as a bookkeeper and Mr. Rix worked as a mechanic. During a seven-year period beginning in November 2006, Ms. Andreatta used Mr. Rix’s company credit card and the company credit cards of two other employees who had left the company, to obtain over $450,000 in goods, services, and cash for her and Mr. Rix’s personal benefit. The cards were used to purchase groceries and other household items, pay car payments and other bills, pay for vacations, including a Caribbean cruise, and for various other purposes.
“Theft from an employer, who trusted you enough to both give you a job and to put you in a position where you had access to company accounts, believing you to be honest, is as ungrateful an act as it is illegal. These defendants fully deserve the sentences they received in this case,” said United States Attorney Peterman.
The case was investigated by agents with the Federal Bureau of Investigation and was prosecuted by Assistant United States Attorney K. Alan Dasher.
Questions concerning this case should be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603.
Cleveland man indicted for making illegal straw purchases of 24 firearms over two daysRead the Press Release
A Cleveland man was indicted for making illegal straw purchases of 24 firearms over two days, said Carole S. Rendon, U.S. Attorney for the Northern District of Ohio and Trevor Velinor, ATF Special Agent in Charge for the Columbus Field Division.
Carlton H. Nunn, 36, was indicted on one count of making false and fictitious statements regarding the sale of firearms.
Nunn purchased two dozen firearms from four dealers on Sept. 10 and 11, 2016, according to the indictment.
Nunn knowingly and unlawfully made false and fictitious statements, intended to deceive dealers, that he was the actual buyer of said firearms when, in fact, he was not the actual buyer of said firearms, according to the indictment.
“This defendant illegally bought two dozen firearms to provide to people with felony convictions,” Rendon said.
“ATF is committed to combating gun violence in our communities, including the individuals who provide firearms to people who are prohibited from having them,” Velinor said. “We will continue to work to make our communities safer by investigating and bringing to prosecution the individuals who enable violent criminals.”
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.
This case is being prosecuted by Assistant United States Attorney Megan R. Miller following an investigation by the ATF.
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.
Budget Finance Company Owner Sentenced to 121 Months for $31 Million Ponzi SchemeRead the Press Release
WHEELING, W. Va. – Donna S. Brown, 65, of Clarington, Ohio, was sentenced by Senior Judge Frederick P. Stamp in U.S. District Court for the Northern District of West Virginia today to 121 months in prison for defrauding investors of more than 800 investment accounts totaling more than $31 million. Brown, who owned Budget Finance Company in New Martinsville, W. Va., was sentenced for charges of wire fraud, mail fraud and money laundering, to which she had entered pleas of guilty on October 24, 2016.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio; Raymond P. Duda, Assistant Special Agent in Charge, Federal Bureau of Investigation (FBI), Pittsburgh Field Division; Thomas J. Holloman, Interim Special Agent in Charge, IRS Criminal Investigation, Washington D.C. Field Office; Tommy Coke, Inspector in Charge, U.S. Postal Inspection Service; West Virginia Attorney General Patrick Morrisey, West Virginia State Auditor and Securities Commissioner Lisa Hopkins; Commissioner Andrea Seidt of the Ohio Division of Securities; Acting Commissioner Dawn Holstein of the West Virginia Division of Financial Institutions; and Wetzel County Prosecutor Tim Haught announced the sentence handed down today.
According to court documents, Brown owned and operated Budget Finance company which was both a licensed consumer loan company and an unlicensed investment company. Between 2005 and 2015, she lured potential investors into investing funds with Budget Finance by promising annual returns of between eight and 12 percent.
Brown mailed checks to investors who requested periodic payments and sent them fraudulent quarterly investment statements reflecting their account balances and interest paid. She also mailed investors IRS 1099 forms, but never sent those forms to the IRS.
Brown abruptly closed the doors of Budget Finance without warning in November 2015.
The actual losses in this case currently are estimated to be somewhere between $9.5 million and $25 million, and the crimes resulted in substantial financial hardship to many of the investor/victims.
U.S. Attorney Glassman commended the investigation of this case by the agencies and Assistant United States Attorney Daniel A. Brown and Deputy Criminal Chief Brenda Shoemaker, who are representing the United States in this case.
Brunswick Resident Sentenced in “21 Jump Street” InvestigationRead the Press Release
Brunswick, GA- Joseph Mincey, 28, of Brunswick, Georgia, was sentenced today in federal court by Chief U.S. District Court Judge Lisa Godbey Wood to 6 years in prison on drug trafficking and firearms related charges. Mincey previously pleaded guilty to possessing cocaine and marijuana with intent to distribute and to possessing firearms in furtherance of a drug trafficking crime.
According to evidence presented during Mincey’s guilty plea and sentencing hearings, investigators of the Glynn-Brunswick Narcotics Enforcement Team (GBNET) initiated an investigation to identify individuals dealing drugs at a local public high school. As part of the investigation, a young looking undercover police officer was introduced into the high school, posing as a student. Mincey was later identified as a dealer of cocaine and marijuana. In November and December of 2015, Mincey sold the undercover officer cocaine, believing the officer to be a high school student. Mincey’s grandmother, who faced State drug charges, assisted in several of the drug transactions. On the date of Mincey’s arrest in January of 2016, law enforcement seized 2 loaded firearms, $2,300 in cash, several pounds of marijuana, cocaine, and other drug trafficking supplies.
U.S. Attorney Edward Tarver said, “It can’t get any worse than a drug dealer and his grandmother selling poison in our schools. It is unfortunate that the life lessons learned by this Defendant led him to a 7-year federal prison sentence.” Tarver mentioned that there is no parole in the federal system.
The investigation of this case was conducted by the GBNET and the ATF. Assistant United States Attorney E. Gregory Gilluly prosecuted the case on behalf of the United States. For questions, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.
Albuquerque Resident Pleads Guilty to Federal Methamphetamine Trafficking ChargeRead the Press Release
ALBUQUERQUE – Ramon Quezada, 32, of Albuquerque, N.M., pled guilty today in federal court to a methamphetamine trafficking charge.
Quezada and his co-defendant Joshua Sedillo, 30, also of Albuquerque, were arrested during an ATF-led investigation that resulted in the filing of 59 federal indictments and one federal criminal complaint charging 104 Bernalillo County residents with federal firearms and narcotics trafficking offenses. The investigation began in mid-April 2016, when ATF personnel from throughout the country joined forces with federal, state, county and local law enforcement agencies in New Mexico to combat the high rate of violent crime in the Albuquerque metropolitan area. The investigators utilized a number of investigative techniques, including undercover operations, historical investigation and targeting of multi-convicted felons in possession of firearms.
The investigation was undertaken in support of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies collaborate with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution primarily based on their prior criminal convictions with the goal of removing repeat offenders from communities in New Mexico for as long as possible.
Quezada and Sedillo were arrested in July 2016, on an indictment charging them with conspiracy to distribute methamphetamine on May 11, 2016, and Sedillo individually with distribution of methamphetamine on May 25, 2016. According to the indictment, the offenses took place in Bernalillo County, N.M.
During today’s proceedings, Quezada pled guilty to a felony information charging him with distribution of methamphetamine. In entering the guilty plea, Quezada admitted that on May 11, 2016, he possessed approximately 90 grams of methamphetamine which he intended to transfer to another person. At sentencing, Quezada faces a maximum penalty of 20 years in federal prison. A sentencing hearing has yet to be scheduled.
To date, 22 of the 104 defendants have entered guilty pleas and one been sentenced. The remaining defendants including Sedillo, have entered not guilty pleas. Charges in indictments are merely accusations and defendants are presumed innocent unless found guilty in a court of law.
The case was investigated by the Albuquerque office of ATF. Assistant U.S. Attorney Jacob Wishard is prosecuting the case.
Albuquerque Man Sentenced for Defrauding Federal Food Stamp ProgramRead the Press Release
ALBUQUERQUE – Sergio Escobedo, 38, of Albuquerque, N.M., was sentenced this morning to two years of probation for defrauding the Supplemental Nutrition Assistance Program, more commonly known as the Food Stamp Program. Escobedo was also ordered to pay $4,678 in restitution to the USDA.
Escobedo is one of six defendants charged with defrauding the Food Stamp Program in a 32-count indictment that was filed in Aug. 2014. The indictment alleged that between Sept. 2009 to May 2010, Escobedo, conspired with Joseph Martin Padilla, 35, Wilfredo Lopez, 48, Joshua Moya, 35, Justin Quintana, 30, and Veronica Hernandez, 43, to defraud the United States through the unauthorized use of Food Stamp benefits, which are currently called Supplemental Nutrition Assistance Program (SNAP) benefits. During this time, Padilla worked as a Family Assistance Analyst for the Income Support Division of the New Mexico Human Services Department (HSD) where he was responsible for determining applicants’ eligibility and benefit level for SNAP benefits.
SNAP is funded by the U.S. Department of Agriculture and is administered by the States. The program was created to alleviate hunger and malnutrition, and permits low income households to obtain more nutritious diet by increasing the food purchasing power for eligible households. In New Mexico, individuals qualify to participate in SNAP based on income and need by completing an application with the Income Support Division of HSD. Once an applicant is deemed eligible for SNAP benefits by a Family Assistance Analyst, the Analyst establishes a SNAP account in the applicant’s name and electronic benefit transfers (EBT), which are determined based on income, resources and household size, are deposited into the account on a monthly basis.
According to the indictment, Padilla abused his position as a Family Assistance Analyst by conspiring with his co-defendants to defraud the United States through the unauthorized use of SNAP benefits. Padilla used names and personal identifiers he obtained from his co-defendants to establish fraudulent SNAP accounts, sometimes in exchange for cash or other things of value. Padilla also established and used a fraudulent SNAP account to fraudulently obtain approximately $1,468.00 in SNAP benefits for himself. Padilla fraudulently established 25 separate SNAP accounts through which the United States was defrauded of approximately $45,263.00 in SNAP benefits. Additionally, Padilla, aided and abetted by his co-defendants, fraudulently established SNAP accounts that were used to fraudulently obtain an aggregate of $12,705.00 in SNAP benefits.
On April 28, 2016, Escobedo pled guilty to one count of the indictment and admitted that he met with Padilla in Jan. 2009, and paid $100.00 for Padilla to process a SNAP benefit application in Escobedo’s name even though Escobedo was ineligible to receive SNAP benefits at that time. Escobedo further admitted that from Sept. 1, 2009 through Feb. 16, 2010 he obtained $4,678.00 in illegal SNAP benefits for himself.
Four of Escobedo’s co-defendants, including Padilla, have entered guilty pleas and have been sentenced:
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On Nov. 23, 2015, Padilla pled guilty two counts of the indictment and admitted that his illegal conduct resulted in an aggregate loss to the U.S. Department of Agriculture and the State of New Mexico of approximately $181,398.76. Padilla was sentenced on Feb. 22, 2016, to a year and a day in prison followed by three years of supervised release and was ordered to pay $181,398.76 in restitution to the USDA.
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On May 19, 2015, Lopez entered a guilty plea to one count of the indictment and admitted that he completed fraudulent applications for SNAP benefits in his name, another for himself in a pseudonym, and in the names of two other individuals. Lopez paid $100.00 to process each of the applications. Lopez was sentenced on Jan. 14, 2016, to four years of probation and was ordered to pay $8,382.00 in restitution to the USDA.
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On May 18, 2015, Quintana pled guilty to one count of the Indictment, and admitted that he agreed to pay Padilla a fee in exchange for arranging for him to receive food stamps unlawfully. Quintana obtained $486.00 in SNAP benefits through his illegal conduct, and received a fee for collecting SNAP applications from six other people and delivering the completed applications to Padilla for the purpose of assisting them in obtaining SPA benefits unlawfully. Quintana caused a monetary loss to the U.S. Department of Agriculture of $9,384.00. He was sentenced on Aug. 17, 2015, to three years of probation and was ordered to pay $9,384.00 in restitution.
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On March 9, 2015, Moya pled guilty to one count of the indictment and admitted that he fraudulently obtained SNAP benefits to which he was not entitled. On May 6, 2015, Moya was sentenced to six months in prison, or time served, followed by three years of supervised release. Moya also was ordered to pay $2,444.00 in restitution.
The fifth co-defendant, Veronica Hernandez, entered into a pre-trial diversion agreement in 2015, and completed a pre-trial diversion program in 2016. On Oct. 20, 2016, the Court entered an order dismissing the charges against Hernandez.
This case was investigated by the Office of Inspector General for the U.S. Department of Agriculture and the Office of Inspector General for New Mexico Human Services, and was prosecuted by Assistant U.S. Attorney Sean J. Sullivan.
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7 Alleged Members of Drug Trafficking Organization Charged in 16-Count IndictmentRead the Press Release
Jackson, TN – Seven alleged members of a drug trafficking organization responsible for shipping large quantities of methamphetamine, cocaine, heroin and Xanax across West Tennessee have been charged in a 16-count indictment. Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, announced the indictment today.
On Thursday, January 19th, and Friday, January 20th, four of the defendants were taken into custody by federal, state and local law enforcement officials. Two of the defendants were already incarcerated on unrelated charges. One remains a fugitive.
The following defendants have been indicted for conspiracy to distribute and possess with the intent to distribute more than 50 grams of ice, among other charges:
• Bernard Cooper, 31, of Jackson, Tennessee
• Courtney Cooper, 37, of Jackson, Tennessee
• Robert Newsom, 34, of Jackson, Tennessee (fugitive)
• Brandon Weddle, 27, of Jackson, Tennessee
• Ronricus Chapman, 30, of Jackson, Tennessee
• Morgan Bond, 29, of Jackson, Tennessee
• Stephen Williams, 29, of Jackson, TennesseeAccording to the indictment, between August 2015 and May 2016, the defendants intentionally conspired with each other to unlawfully distribute and possess with the intent to distribute more than 50 grams of ice — meth with a purity level greater than 80 percent. The defendants allegedly aided and abetted each other during the commission of the aforementioned crime.
During the course of a nearly two-year investigation of the criminal organization, law enforcement officers seized more than 550 kilograms of marijuana, 240 grams of ice, 220 grams of cocaine, 20 grams of heroin, and 1,000 Xanax pills.
During its round-up of the defendants, law enforcement seized an additional eight pounds of marijuana, as well as small amounts of heroin, cocaine and Xanax. Two loaded pistols and five vehicles were also seized.
Additional charges listed in the indictment:
• Bernard Cooper, Newsome, Weddle, Chapman and Bond are also charged with additional counts of conspiring with each other to unlawfully distribute and possess with the intent to distribute cocaine, more than 100 kilograms of marijuana, and more than 50 grams of ice. They also aided and abetted each other to distribute, attempt to distribute, possess with the intent to distribute and attempt to possess with the intent to distribute the aforementioned substances.
• Bernard Cooper and Newsome are charged with an additional count of intentionally distributing, attempting to distribute, possessing with the intent to distribute and attempting to possess with the intent to distribute more than five grams of ice.
• Bernard Cooper and Courtney Cooper are charged with an additional count of intentionally distributing, attempting to distribute, possessing with the intent to distribute and attempting to possess with the intent to distribute meth.
• Bernard Cooper is also charged with unlawfully possessing a .223 caliber rifle; and intentionally distributing, attempting to distribute, possessing with the intent to distribute and attempting to possess with the intent to distribute heroin.
• Williams is also charged with unlawfully possessing a 12-gauge shotgun, which had been previously shipped and transported in interstate commerce.
• Courtney Cooper has also been charged with intentionally distributing, attempting to distribute, possessing with the intent to distribute and attempting to possess with the intent to distribute more than 50 grams of ice.
All seven defendants face mandatory minimum sentences of 10 years in federal prison and fines of up to $10 million for both the conspiracy and aiding and abetting charges.
Penalties for the additional charges listed in the indictment range from five to 20 years in federal prison and carry fines of up to $10 million.
This case is being investigated by the Drug Enforcement Administration (DEA); Tennessee Bureau of Investigation (TBI); Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF); Federal Bureau of Investigation (FBI); and the Jackson-Madison County Metro Narcotics Unit.
Assistant U.S. Attorney Beth Boswell is prosecuting this case on the government’s behalf.
The charges and allegations in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Sunday 22 January 2017
Funk Man Sentenced for Possessing Child PornographyRead the Press Release
United States Attorney Deborah R. Gilg announced that Joshua James Just, 39, formerly of Funk, Nebraska, was sentenced on January 20, 2017, in Lincoln, Nebraska, to 66 months in prison by United States District Judge John M. Gerrard, for possession of child pornography. After serving his prison sentence Just will be required to serve an additional 7 years on supervised release and be required to register as a sex offender and pay a $1,000.00 fine.
In March of 2015, while reviewing data for a peer-to-peer investigation, an investigator with the Nebraska Attorney General’s Office observed an IP address with child pornography files available for sharing. Further investigation determined that the physical location and subscriber of the internet service was Joshua Just at his residence in Funk, Phelps County, Nebraska. In December, 2014, investigators made a direct connection with this same IP address and downloaded several digital files. One such file, which was 10 minutes, 2 seconds in length, depicted minors engaged in sexually explicit conduct as defined by federal law. Investigators also viewed two additional files which were made available for sharing, both of which contained similar images of child pornography involving prepubescent minors.
A search warrant was executed on Just’s residence and items of computer equipment were seized. The examination of Just’s computer revealed more than 22,761 videos and image files, 209 of which were categorized as “files of interest” related to past child pornography investigations.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Nebraska Attorney General’s Office.
Saturday 21 January 2017
Lincoln Man Sentenced for User/Addict in Possession of FirearmRead the Press Release
United States Attorney, Deborah R. Gilg, announced that on January 20, 2017, Jetwan G. Williams, 22, of Lincoln, was sentenced to time served, (six days in custody) and three years of supervised release for being a user or addict in possession of a firearm. The three-year supervised release term includes 90 days of home confinement. Williams was also ordered to pay a $100 special assessment.
The charge arose from an investigation into a photo posted to Facebook by Williams which showed Williams holding an SKS rifle and a handgun. In the photo, a shotgun was shown hanging on the wall behind Williams. The photo was taken at the Lincoln residence of one of Williams’ friends, and all the firearms belonged to that friend. At the time the photo was posted, in January of 2016, Williams was a user of marijuana, making it unlawful for him to possess firearms.
This case was investigated by the Lincoln Police Department.
Friday 20 January 2017
Woman Charged with Federal Stolen Identity Refund FraudRead the Press Release
TALLAHASSEE, FLORIDA – Teona N. Rodgers, 27, of Tampa, made an initial appearance yesterday in the U.S. District Court in Tallahassee after a federal grand jury returned an indictment charging her with theft of government funds, use of unauthorized access devices, aggravated identity theft, and false claims. The indictment was announced by Christopher P. Canova, United States Attorney for the Northern District of Florida.
The indictment alleges that Rodgers unlawfully used the personal identifying information and account numbers of several individuals to assist in the filing of numerous fraudulent federal income tax returns, seeking more than $100,000 in federal tax refunds. The trial is scheduled for March 20.
This case resulted from an investigation by the Emerald Coast Financial Crimes Task Force, comprised of the Internal Revenue Service-Criminal Investigation and the Leon County Sheriff’s Office, as well as the United States Secret Service. Assistant United States Attorney Gary Milligan is prosecuting the case.
An indictment is merely an allegation by a grand jury that a defendant has committed a violation of federal criminal law and is not evidence of guilt. All defendants are presumed innocent and entitled to a fair trial, during which it will be the government’s burden to prove guilt beyond a reasonable doubt at trial.
The U.S. Attorney’s Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the U.S. Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
For more information, contact:
Amy Alexander, Public Information Officer(850) 216-3854, [email protected]
Winchester Man Pleads Guilty to Child Pornography Production ChargesRead the Press Release
Harrisonburg, VIRGINIA – A Winchester, Virginia man, who filmed himself sexually exploiting two minor children, pled guilty today in the United States District Court for the Western District of Virginia in Harrisonburg to two federal child pornography production charges, Acting United States Attorney Rick A. Mountcastle announced.
LaMarcus Thomas, 32, of Winchester, Va., was indicted on January 13, 2016 on six counts of producing child pornography. Today in District Court, the defendant pled guilty to two counts of production of child pornography.
According to evidence presented at today’s guilty plea hearing, in the fall of 2014 the Winchester Police Department began an investigation into a complaint that two children had been molested by Thomas. After being arrested on state sex crime allegations for acts against the two children, the Winchester Police Department recovered a cellphone that belonged to Thomas.
Examination of the cell phone revealed numerous images and movies of child pornography depicting two different minor boys. It appeared the two victims were likely sleeping during the production of the images and movies, which showed various images of the penis and hands of the defendant. Thomas admitted producing the child pornography and identified himself and the two minors depicted in the images in the videos. The investigation determined that Thomas spent significant time with the two minors depicted in the videos, including spending overnight visits with the victims.
The investigation of the case was conducted by the Federal Bureau of Investigation, the Virginia State Police and the Winchester Police Department. Assistant United States Attorney Nancy S. Healey and Criminal Division Trial Attorney Leslie Williams Fisher of the Child Exploitation and Obscenity Section (CEOS) prosecuted the case for the United States.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Wallingford Man Charged with Distributing Fentanyl and SteroidsRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that DANIEL GUILLEN, 28, of Wallingford, was arrested yesterday on a federal criminal complaint charging him with distributing fentanyl and anabolic steroids. The charges stem from an ongoing statewide initiative targeting narcotics dealers who distribute heroin, fentanyl or opioids that cause death or serious injury to users.
GUILLEN appeared today before U.S. Magistrate Judge Joan G. Margolis in New Haven and was ordered detained.
As alleged in court documents, on August 31, 2016, the Wallingford Police Department and medical personnel responded to a residence after a report of an untimely death of a 30-year-old male. At the scene, officers seized 12 wax paper folds, eight of which contained a powdery substance. The State of Connecticut Forensics Laboratory subsequently reported that the substance tested positive for the presence of fentanyl. The investigation revealed that GUILLEN had provided the drugs to the victim shortly before the victim’s death. The investigation also revealed that GUILLEN sold anabolic steroids.
The complaint charges GUILLEN with possession with intent to distribute, and distribution of fentanyl, an offense that, given GUILLEN’s criminal history, carries a maximum term of imprisonment of 30 years. The complaint also charges GUILLEN with possession with intent to distribute, and distribution of, anabolic steroids, an offense that carries a maximum term of imprisonment of 20 years.
U.S. Attorney Daly stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the Drug Enforcement Administration’s New Haven Tactical Diversion Squad, Wallingford Police Department, U.S. Postal Inspection Service and State of Connecticut Department of Parole and Community Services. The Task Force includes participants from the New Haven, Hamden, Greenwich, Shelton, Bristol, Vernon, Wilton, Milford, Monroe, Fairfield and Manchester Police Departments, and the Connecticut State Police.
This case is being prosecuted by Assistant U.S. Attorney John T. Pierpont, Jr.
Uryan Frymire Charged with Possession with Intent to Distribute CocaineRead the Press Release
FORT WAYNE – The United States Attorney for the Northern District of Indiana, David Capp, announced that a criminal complaint was filed charging Uryan Frymire, 37, of Ohio, with possession with intent to distribute more than five kilograms of cocaine.
According to documents in this case, there was a traffic stop conducted in Texas on January 17, 2017 of a semi-tractor where 62 packages or approximately 70 kilograms of a white powdery substance were found. The substance field tested positive for cocaine. The driver of the semi-tractor, who was the only occupant, said he was destined for Fort Wayne and Chicago, Illinois to deliver the cocaine in the roof. The driver agreed to the delivery of 17 kilograms of cocaine to Fort Wayne. On January 19, 2017, the driver made a controlled delivery to Frymire who was arrested by Homeland Security Agents.
The United States Attorney’s Office emphasizes that a Criminal complaint is merely an allegation and that all persons charged are presumed innocent until and unless proven guilty in court.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
This investigation was conducted by the United States Homeland Security Investigations with the assistance of the Allen County, Indiana Sheriff’s Department; Greenville, Indiana Police Department; Indiana State Police; and United States Drug Enforcement Administration. This case is being handled by Assistant United States
UPMC Claims Manager Admits Paying $846K to Two Ghost EmployeesRead the Press Release
PITTSBURGH - A resident of Georgetown, Texas, pleaded guilty in federal court to a charge of embezzlement in connection with health care, Acting United States Attorney Soo C. Song announced today.
Ronald Larry Locy, 48, pleaded guilty to one count before United States District Judge David Stewart Cercone.
In connection with the guilty plea, the court was advised that Locy was the Senior Director of claims for the UPMC Health Plan Claims Department. According to the government, Locy caused UPMC to pay two “ghost employees” of UPMC Health Plan, for work and bonuses to which those ghost employees were not entitled. The loss to UPMC Health Plan was approximately $846,819.
Judge Cercone scheduled sentencing for May 24, 2016, at 11 a.m. The law provides for a total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Robert S. Cessar is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation conducted the investigation that led to the prosecution of Locy.
Two South Florida Men Plead Guilty to Conspiracy to Commit Wire Fraud and Aggravated Identity TheftRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces that Wilbert Theodore (30, Miami) and Ralph August Lohier (27, Miami) have pleaded guilty to conspiracy to commit wire fraud and aggravated identity theft. Each face a maximum penalty of 20 years in federal prison for the conspiracy charge, to be followed by a consecutive mandatory minimum of 2 years’ imprisonment for the aggravated identity theft charge. As part of the plea agreement, both agreed to forfeit computer media and a credit card re-encoder utilized as part of their criminal activity.
According to the plea agreement, in 2016, Lohier and Theodore conspired with another individual in south Florida to obtain debit cards that had been re-encoded with legitimate account numbers assigned to genuine individuals. In doing so, Lohier was able to obtain fraudulent cards with Lohier’s name embossed on them. Another portion of the cards were embossed with the name C.S. Thereafter, Theodore obtained a counterfeit Florida Driver’s License in the name of C.S. After obtaining the cards and the counterfeit license, Lohier and Theodore traveled from south Florida to various places, including Flagler and Orange Counties, using the cards. They then purchased merchandise, funded reloadable debit cards, sent and received multiple money transfers through Western Union.
On March 8, 2016, a Florida Highway Patrol trooper conducted a traffic stop on I-95 in Flagler County, being driven by Lohier, with Theodore inside. During the stop, the trooper located the counterfeit driver’s license in the name of C.S., but containing a picture of Theodore. While detained in the trooper’s vehicle, Theodore and Lohier attempted to conceal a large quantity of re-encoded reloadable Visa debit cards within the rear section of the vehicle.
A search of Lohier’s vehicle revealed an additional quantity of re-encoded, reloaded debit cards in the name of the Lohier and C.S. Law enforcement also recovered computer media and a credit card re-encoder from the vehicle. Further investigation determined that Lohier and Theodore possessed 86 re-encoded cards.
This case was investigated by the Florida Highway Patrol and the United States Secret Service - Jacksonville Field Office. It is being prosecuted by Assistant United States Attorney Kevin C. Frein.
Twin Cities Child Care Provider Charged with Stealing Hundreds of Thousands from Low-Income Assistance ProgramRead the Press Release
United States Attorney Andrew M. Luger today announced an indictment charging FOZIA SHEIK ALI, 50, for fraudulently obtaining at least hundreds of thousands of dollars for child care services that had not been provided. ALI is charged with wire fraud and theft of public money. The indictment was unsealed late yesterday in U.S. District Court in Minneapolis, Minn.
“This indictment describes a selfish criminal act that kept money from being available for deserving families,” said Minnesota Bureau of Criminal Apprehension Superintendent Drew Evans. “BCA agents, along with our partners, will continue to identify and arrest people who commit these costly crimes.”
According to the indictment and documents filed in state court, ALI operated the Salama Child Care Center (Salama) in Minneapolis. Between at least December 2013 and May 2015, ALI defrauded the Child Care Assistance Program (CCAP) to obtain payments from the Minnesota Department of Human Services (DHS) for child care services that were not actually provided. The CCAP program was designed to help eligible families pay for the costs of child care. CCAP in Minnesota is administered by DHS and funded by the United States Department of Health and Human Services (HHS) and the State of Minnesota.
According to the indictment, ALI submitted claims for CCAP payments that overstated the number of children who actually attended and received day care services from Salama. The claims asserted that more than 100 children attended and received child care at Salama on a given day. On more than one occasion, the claims falsely inflated the number of children that had attended Salama on a given day by more than 400 percent, including on days when Salama was closed.
According to the indictment, ALI stole hundreds of thousands of dollars from the State of Minnesota and the federal government.
This case is the result of an investigation conducted by the Minnesota Bureau of Criminal Apprehension, Criminal Investigation Division of the IRS, FBI, HHS-OIG, and the Minnesota Department of Human Services.
Assistant U.S. Attorney John Kokkinen is prosecuting the case.
Defendant Information:FOZIA SHEIK ALI, 50
Hopkins, Minn.Charges:
• Wire fraud, 4 counts
• Theft of public money, 1 countTerry Man Sentenced for Bankruptcy FraudRead the Press Release
Jackson, Miss - Kenneth Bowman, Jr., 63, of Terry, was sentenced today by U.S. District Judge Tom S. Lee to five years of supervised probation and ordered to pay $86,849.34 in restitution for bankruptcy fraud, announced U. S. Attorney Gregory K. Davis, Acting U. S. Trustee Henry G. Hobbs, Jr. of Region 5, and FBI Special Agent in Charge Christopher Freeze. Bowman pled guilty to the charge on September 13, 2016.
Bowman, as the officer and representative of Piggly Wiggly of Crystal Springs, Inc., a debtor in Chapter 11 bankruptcy in the Southern District of Mississippi, embezzled approximately $101,733.55 from the bankruptcy estate. Bowman appropriated to his own use estate funds belonging to the debtor, specifically making checks payable to cash and using the cash to satisfy his personal debts, and reducing assets available to creditors.
The Office of the U. S. Trustee and the U.S. Bankruptcy Court for the Southern District of Mississippi referred the matter to the U. S. Attorney for prosecution. The Federal Bureau of Investigation and the U.S. Trustee assisted in the investigation. Assistant U.S. Attorney Mary Helen Wall and Special Assistant U.S. Attorney Sammye S. Tharpe prosecuted the case.
St. Thomas Man Pleads Guilty to Threatening A Federal OfficerRead the Press Release
St. Thomas, USVI – Thomas Bitter, 36, pleaded guilty today in District Court on St. Thomas before visiting District Court Judge Juan R. Sanchez to one count of threatening a federal officer, United States Attorney Ronald W. Sharpe announced.
According to the plea agreement, between May and June of 2016, Bitter sent threatening e-mails to a Judicial Security Inspector at the District Court of the Virgin Islands after the Inspector admonished Bitter for sending numerous threatening e-mails to a federal judge in the Central District of California.
Under federal law, Bitter faces a maximum sentence of six years in prison, three years of supervised release, and a $250,000 fine. Sentencing is scheduled for March 9, 2017.
This case was investigated by the Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Everard E. Potter.
Springfield Man Arrested for Identity Theft and Theft of Social Security BenefitsRead the Press Release
BOSTON – A Dominican man living in Springfield was charged and arrested today for using an American citizen’s identity to obtain over $100,000 in Social Security benefits.
Bartolo Ramirez, 48, was charged with falsely representing a Social Security number and theft of public money. He is detained pending a detention and probable cause hearing on Wednesday, Jan. 25, 2017.
According to the criminal complaint, Ramirez was born in the Dominican Republic, entered the United States as a stowaway in 1990, and was apprehended by authorities. He was allowed to leave the United States voluntarily in 1993. By 2007, Ramirez had returned to the United States and settled in Springfield, Mass., where he obtained a Social Security card and state ID card using the name and Social Security number of an American citizen. In 2008, Ramirez applied for Social Security disability benefits under the American citizen’s identity, and collected more than $100,000 in benefits. Ramirez also used the American citizen’s name when he was arrested in Massachusetts in 2012 in an unrelated case.
The charge of misrepresenting a Social Security number provides for a sentence of no greater than five years in prison, three years of supervised release, and a fine of $250,000, or twice the gross gain or loss, whichever is greater. The charge of theft of public money provides for a sentence of no greater than 10 years in prison, three years of supervised release, and a fine of $250,000, or twice the gross gain or loss, whichever is greater. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney William D. Weinreb; Scott Antolik, Special Agent in Charge of the Social Security Administration, Office of Inspector General, Office of Investigations, Boston Field Division; Matthew Etre, Special Agent in Charge of Homeland Security Investigations in Boston; Phillip Coyne, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of the Inspector General, Office of Investigations; William Squires, Special Agent in Charge of the U.S. Department of Agriculture, Office of Inspector General, Office of Investigation, Northeast Field Office; and Suzanne M. Bump, State Auditor of the Commonwealth of Massachusetts, made the announcement today. Special Assistant U.S. Attorney Timothy Landry of Weinreb’s Major Crimes Unit is prosecuting the case.
The details contained in the criminal complaint are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Société Générale Agrees to Pay $50 Million Penalty to Settle RMBS Fraud ClaimsRead the Press Release
United States Attorney Robert L. Capers announced today that Société Générale, S.A. will pay a $50 million civil penalty to resolve claims related to its activities, which were conducted through several affiliates (together, “SocGen”), in connection with the marketing, sale, and issuance of a residential mortgage-backed security (“RMBS”) named SG Mortgage Securities Trust 2006-OPT2 (“SG 2006-OPT2”). As part of the agreement, SocGen has acknowledged in writing that it made false representations to prospective investors in SG 2006-OPT2. Investors, including federally insured financial institutions, suffered significant losses on their investments in SG 2006-OPT2.
The settlement includes a statement of facts agreed to by SocGen, whereby SocGen acknowledges responsibility for its conduct. For example, SocGen acknowledges that it falsely represented to investors that the loans underlying SG 2006-OPT2 were originated generally in accordance with the loan originator’s underwriting guidelines. Indeed, as detailed in the statement of facts, SocGen’s third-party due diligence vendor for SG 2006-OPT2 determined that almost 40% of the loans it reviewed were underwritten outside of guidelines and lacked adequate compensating factors to make the loans eligible for securitization. SocGen acknowledges that it did not disclose these results to investors.
Likewise, SocGen represented to investors that, at the time of origination, no loan in SG 2006-OPT2 had a loan-to-value or combined loan-to-value ratio of more than 100% (in other words, that the value of any mortgage on a property did not exceed the value of the property itself) – a representation that SocGen now acknowledges was false. Moreover, SocGen knew that there were industry-wide problems with subprime loan origination practices. As described by a senior member of SocGen’s Contract Finance group, “The whole process [was] a joke.”
“SocGen’s acknowledgement of its misconduct in the securitization of SG 2006-OPT2 was a critical component of this resolution. It severely impacted investors and institutions across the United States, including in this district. Most emphatically, it was not a ‘joke’”, stated United States Attorney Capers. “We will not tolerate investment banks making false representations to investors – if and when they do so, they will be held accountable.” Mr. Capers extended his grateful appreciation to the Office of the Inspector General for the Federal Housing Finance Agency for its assistance in conducting the investigation in this matter.
The $50 million civil monetary penalty resolves claims under the Financial Institutions Reform Recovery and Enforcement Act of 1989, which authorizes the federal government to impose civil penalties against financial institutions that violate various predicate offenses, including wire and mail fraud. As part of the settlement, SocGen has agreed to fully cooperate with any ongoing investigations related to the conduct covered by the agreement.
Assistant U.S. Attorneys Clayton P. Solomon, Morgan J. Clark, and Katharine E.G. Brooker led the government’s investigation.
About the RMBS Working Group: The RMBS Working Group, part of the Financial Fraud Enforcement Task Force, was established by the Attorney General in late January 2012. The Working Group has been dedicated to initiating, organizing, and advancing new and existing investigations by federal and state authorities into fraud and abuse in the RMBS market that helped precipitate the 2008 Financial Crisis. The Working Group’s efforts to date have resulted in settlements providing for tens of billions of dollars in civil penalties and consumer relief from banks and other entities that are alleged to have committed fraud in connection with the issuance of RMBS.
To report RMBS fraud, go to: http://www.stopfraud.gov/rmbs.html
Slippery Rock Cheese Companies Sentenced for Selling Adulterated ProductsRead the Press Release
PITTSBURGH - Two companies located in Slippery Rock, Pennsylvania, have each been sentenced in federal court to 36 months’ probation and have each been ordered to forfeit to the United States $500,000 on the companies’ convictions relating to their introduction of adulterated and misbranded cheese products into interstate commerce, Acting United States Attorney Soo C. Song announced today.
United States District Judge Mark R. Hornak imposed the sentences on Universal Cheese & Drying, Inc. and International Packing, LLC.
According to information presented to the court, the defendants packaged and sold cheese under various labels at the Castle Cheese facility in Slippery Rock, PA. The cheese was distributed through retail, food service, and wholesale customers throughout the United States. The defendants had knowledge of the Food and Drug Administration’s (“FDA”) regulations and standards of identity for Parmesan and Romano cheese products and were aware that the products did not conform with FDA standards of identity for real Parmesan and Romano cheese, but represented to customers that the products contained one hundred percent real Parmesan and Romano cheese. The defendants also knew that the cheese products were misbranded because they did not bear labels that accurately reflected the products’ ingredients. The defendants likewise knew that the cheese products were also adulterated in that certain ingredients had been substituted or omitted and other ingredients had been added. The defendants used proceeds from the sale of
the misbranded and adulterated cheese products to continue the operation of the cheese manufacturing and packaging at the Slippery Rock facility.Prior to imposing sentence, Judge Hornak stated that the sentences are appropriate under applicable provisions of the Sentencing Reform Act and fulfill the purposes of sentencing.
Assistant United States Attorney Tonya Sulia Goodman prosecuted this case on behalf of the government.
Acting United States Attorney Song commended the Food and Drug Administration's Office of Criminal Investigations and the Internal Revenue Service, Criminal Investigation Division, for the investigation leading to the successful prosecution of Universal Cheese & Drying, Inc. and International Packing, LLC.
Scranton Woman Indicted on Cocaine and Heroin Trafficking ChargesRead the Press Release
SCRANTON- The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Patricia Cook, age 59, of Scranton, Pennsylvania, was indicted by a federal grand jury on drug trafficking and attempted witness tampering charges.
The indictment was unsealed following Cook’s arraignment on January 17, 2017, before U.S. District Magistrate Judge Karoline Mehalchick. Cook was placed on supervised release pending trial.
According to United States Attorney Bruce D. Brandler, the indictment alleges that Cook distributed and conspired to distribute heroin and cocaine between January 2015 and April 2015, in Scranton. The indictment also alleges that she attempted to tamper with a witness in a grand jury investigation.
The investigation was conducted by the Federal Bureau of Investigation. Assistant United States Attorney Jenny P. Roberts is prosecuting the case.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for each offense is 20 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Scranton Funeral Home Director Charged with Tax EvasionRead the Press Release
SCRANTON – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a Scranton funeral home director, Al T. Hughes, age 58, of Scranton, Pennsylvania, was indicted on January 17, 2017, by a federal grand jury for federal income tax evasion.
The indictment was unsealed following Hughes’s arraignment on January 19, 2017, before U.S. District Magistrate Judge Karoline Mehalchick. Hughes was released on his own recognizance.
According to United States Attorney Bruce D. Brandler, the five count indictment alleges that Hughes diverted approximately $1.25 million in corporate receipts to his personal benefit, and failed to report the diverted receipts as income on his 2010, 2011, 2012, 2013, and 2014 federal tax returns resulting in a substantial tax due and owing the Internal Revenue Service. It also alleges that he cashed hundreds of customer checks, intended for payment of funeral home services, at various financial institutions, including a check cashing service in Scranton.
Internal Revenue Service Criminal Investigation Acting Special Agent in Charge Gregory Floyd said, “The license to run a business is not a license to avoid paying taxes. Al T. Hughes’s misconduct of hiding income cheated all Americans, since we all pay our fair share for the government services and protections that we enjoy.”
The investigation was conducted by the Criminal Investigation Division of the Internal Revenue Service – Scranton Office. The case is being prosecuted by Assistant United States Attorney Michelle Olshefski.
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for each count of the indictment is five years in prison, a term of supervised release following imprisonment, restitution, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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