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Friday 13 January 2017
Takata Corporation Agrees to Plead Guilty and Pay $1 Billion in Criminal Penalties for Airbag SchemeRead the Press Release
Three Takata Executives Charged with Wire Fraud and Conspiracy
Tokyo-based Takata Corporation, one of the world’s largest suppliers of automotive safety-related equipment, agreed to plead guilty to wire fraud and pay a total of $1 billion in criminal penalties stemming from the company’s fraudulent conduct in relation to sales of defective airbag inflators. An indictment was also unsealed charging three Takata executives with wire fraud and conspiracy in relation to the same conduct.
U.S. Attorney Barbara McQuade of the Eastern District of Michigan, Chief Andrew Weissmann of the Fraud Section of the Justice Department’s Criminal Division, Special Agent in Charge David P. Gelios of the FBI’s Detroit Field Office and Inspector General Calvin L. Scovel III of the U.S. Department of Transportation Office of Inspector General made the announcement.
“Automotive suppliers who sell products that are supposed to protect consumers from injury or death must put safety ahead of profits,” said U.S. Attorney McQuade. “If they choose instead to engage in fraud, we will hold accountable the individuals and business entities who are responsible.”
“For more than a decade, Takata repeatedly and systematically falsified critical test data related to the safety of its products, putting profits and production schedules ahead of safety,” said Fraud Section Chief Weissmann. “This announcement is the latest in the automotive industry enforcement actions the Fraud Section has taken to protect U.S. consumers against fraud.”
“Today’s criminal charges of the Takata Corporation and three of its employees should be a reminder to other corporations and their employees that if they commit fraud, the FBI and its law enforcement partners will ensure they are held accountable for their actions,” said Special Agent in Charge Gelios. “Whether it is the manipulation of test results which impact customer safety, defective product development or any other type of fraud, we will continue to aggressively investigate corporate fraud allegations to protect consumers in the United States and elsewhere.”
“I offer my deepest sympathies to the families and friends of those who died and to those who were injured as a result of the Takata Corporation’s failure to fulfill its obligation to ensure the safety of its airbag systems,” said Inspector General Scovel. “Because safety is and will remain the highest priority for my office, we will continue to work tirelessly with our law enforcement and prosecutorial partners in pursuing those who commit criminal violations of transportation-related laws and regulations. Along with similar settlements with General Motors in September 2015 and Toyota in March 2014, today’s agreement makes clear to all auto manufacturers and parts suppliers their duty in keeping the public safe.”
According to the company’s admissions, in the late 1990s, Takata began developing airbag inflators that relied upon ammonium nitrate as their primary propellant. From at least in or around 2000, Takata knew that certain ammonium nitrate-based inflators were not performing to the specifications required by the auto manufacturers. Takata also knew that certain inflators had sustained failures, including ruptures, during testing. Nevertheless, Takata induced its customers to purchase these airbag systems by submitting false and fraudulent reports and other information that concealed the true condition of the inflators. This fraudulent data made the performance of the company’s airbag inflators appear better than it actually was, including by omitting that, in some instances, inflators ruptured during testing. Takata employees – including a number of key executives – routinely discussed the falsification of test reports being provided to Takata’s customers in email and in verbal communications. Even after the inflators began to experience repeated problems in the field – including ruptures causing injuries and deaths – Takata executives continued to withhold the true and accurate inflator test information and data from their customers.
- addition, Takata took no disciplinary actions against those involved in the falsification of test data until 2015, despite the fact that senior executives had been made aware of the fraudulent conduct years earlier.
Takata has agreed to plead guilty to a one-count criminal information filed today in the Eastern District of Michigan and assigned to U.S. District Judge George Caram Steeh, charging the company with one count of wire fraud. Under the terms of the agreement, Takata will pay a total criminal penalty of $1 billion, including $975 million in restitution and a $25 million fine. Two restitution funds will be established: a $125 million fund for individuals who have been physically injured by Takata’s airbags and who have not already reached a settlement with the company, and a $850 million fund for airbag recall and replacement costs incurred by auto manufacturers who were victims of Takata’s fraud scheme. A court-appointed special master will oversee administration of the restitution funds. Takata has also agreed to implement rigorous internal controls, retain a compliance monitor for a term of three years and cooperate fully with the department’s ongoing investigation, including its investigation of individuals.
The three Takata executives – Shinichi Tanaka, 59; Hideo Nakajima, 65; and Tsuneo Chikaraishi, 61, all Japanese citizens – were each charged in an indictment filed on Dec. 7, 2016, in the Eastern District of Michigan with one count of conspiracy to commit wire fraud and five counts of wire fraud for their alleged conduct in connection with the above-described fraud scheme.
The department reached this resolution based on a number of factors, including Takata’s extensive cooperation with the government’s investigation. However, the company did not receive more significant mitigation credit, either in the penalty or the form of resolution, because of the nature of the conduct to which the company is pleading guilty, including the approximate 15-year duration of the fraud, the pervasiveness of the scheme into the executive level of management and the potential risk the fraud posed to drivers and passengers.
An indictment is merely an allegation and all defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The FBI and the U.S. Department of Transportation’s Office of Inspector General investigated the case. Assistant Chief Robert Zink and Trial Attorneys Brian K. Kidd, Christopher D. Jackson and Andrew R. Tyler of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys John K. Neal, Erin S. Shaw and Andrew J. Yahkind of the Eastern District of Michigan are prosecuting the case. The Criminal Division’s Office of International Affairs also provided assistance.
Court Documents:
Takata Information Takata Plea Agreement Tanaka et al IndictmentStatement by Attorney General Loretta E. Lynch on the Departure of John Leonardo, U.S. Attorney for the District of ArizonaRead the Press Release
Attorney General Loretta E. Lynch released the following statement on the departure of Judge John Leonardo, U.S. Attorney for the District of Arizona:
“During his four and a half years as United States Attorney for the District of Arizona, Judge John Leonardo has worked tirelessly to uphold our laws and defend our values,” said Attorney General Loretta E. Lynch.
“During his tenure, he oversaw a number of significant cases, including the first jury trial involving a domestic attack committed in the name of ISIL and the government’s successful prosecution of the perpetrator of the 2011 mass shooting in Tucson. He was also a steadfast partner to Arizona’s 22 federally recognized Indian tribes, working closely with tribal officials to combat violent crime in Indian Country. John has served the people of Arizona – and all of the American people – with integrity and distinction. I want to thank him for his exceptional contributions, and I wish him the best in his future endeavors.”
Shreveport man sentenced to more than 11 years in prison for methamphetamine, firearm chargesRead the Press Release
SHREVEPORT, La. – U.S. Attorney Stephanie A. Finley announced that a Shreveport man was sentenced Thursday to 135 months in prison for methamphetamine distribution and handgun possession.
Paul Matthew Garza, 35, of Shreveport, was sentenced by U.S. District Judge S. Maurice Hicks Jr. on one count of possession with intent to distribute methamphetamine and one count of possession of a firearm in furtherance of drug trafficking. He was also sentenced to five years of supervised release. According to the September 20, 2016, guilty plea, Garza’s vehicle was pulled over during a traffic stop on May 25, 2016, near the Louisiana-Texas border in Caddo Parish. Upon searching his vehicle, law enforcement found 408 grams of methamphetamine and 142.73 grams of Xanax bars. Upon searching his home, additional methamphetamine and Xanax were found. A Ruger LCP .380 semi-automatic handgun, digital scales and $17,400 were also found in his home.
The DEA and the Caddo Parish Sheriff’s Office conducted the investigation. Assistant U.S. Attorney Tennille M. Gilreath prosecuted the case.
Shreveport man sentenced to 60 months in prison for child pornography chargeRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced that a Shreveport man was sentenced Monday to five years in prison for possessing child pornography.
Ronald Wilson, 54, was sentenced by U.S. District Judge S. Maurice Hicks Jr. on one count of possession of child pornography. He was also sentenced to five years of supervised release and must register as a sex offender. According to the April 14, 2016 guilty plea, law enforcement officers searched the Wilson’s Shreveport residence in March of 2015. Officers found 19 videos of child pornography stored on several electronic devices in his bedroom.
This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who 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.
The U.S. Department of Homeland Security and U.S. Immigration & Customs Enforcement (ICE) also encourage the public to report suspected child predators and any suspicious activity through its toll-free hotline at (866) 347-2423. Investigators are available at all hours to answer hotline calls. Tips or other information can also be submitted to ICE online by visiting their website at www.ice.gov/exec/forms/hsi-tips/tips.asp or through the Operation Predator smartphone application www.ice.gov/predator/smartphone-app. Tips may be submitted anonymously.
Homeland Security Investigations, Louisiana State Attorney General’s Office and Louisiana State Police conducted the investigation. Assistant U.S. Attorney Earl M. Campbell prosecuted the case.
Second Haitian National Sentenced to 19 Years in Prison for International Hostage Taking of U.S. CitizenRead the Press Release
Marcus Noel, 40, of Port-au-Prince, Haiti, was sentenced by U.S. District Court Judge Joan A. Lenard to 235 months’ imprisonment after having previously pled guilty to the international hostage taking of a United States citizen in Haiti. Co-defendant Moises Louinis, 24, also of Port-au-Prince, was previously sentenced to 144 months’ imprisonment for his participation in the scheme.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, made the announcement.
According to statements made and documents filed in court, defendants Noel and Louinis were charged with the armed hostage taking of a United States citizen on July 5, 2014, in Petion-ville, a neighboring suburb of Port-au-Prince, Haiti. Noel and Louinis approached the victim as she stood by the side of the road and forced her into her car at gunpoint. The defendants then drove with the victim around Port-au-Prince and forced her to place ransom calls to various family members in Haiti. The victim was eventually taken to a school operated by Noel, where she was kept blindfolded, gagged and handcuffed inside a locked room for three days. In addition, the victim was forced to sleep on dirt floors and given only minimal food and water. During the victim’s captivity, Noel continued to call the victim’s family members to demand a $150,000 ransom and made threats to kill the victim and her children if the ransom was not paid. On July 7, 2014, the victim was rescued by Haitian law enforcement officials.
Mr. Ferrer commended the investigative efforts of the FBI, Haitian National Police and the Central Directorate of the Judicial Police (DCPJ) Anti-Kidnapping Unit. Mr. Ferrer thanked the Haitian Government, including the Haitian Ministry of Justice for their assistance with this matter. The case was prosecuted by Assistant U.S. Attorney Cristina M. Moreno.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Schenectady Felon Convicted of Illegally Possessing Handgun and AmmunitionRead the Press Release
ALBANY, NEW YORK – A jury yesterday voted to convict Tameen “Nitty” Johnson, age 39, of Schenectady, New York, of illegally possessing a loaded handgun.
The announcement was made by United States Attorney Richard S. Hartunian and Special Agent in Charge Andrew W. Vale of the Albany Division of the Federal Bureau of Investigation.
Johnson could not possess the handgun or ammunition because of prior felony convictions for firearm, drug and assault offenses. He faces at least 15 years and up to life in prison when he is sentenced by Senior United States District Judge Thomas J. McAvoy.
The evidence at trial showed that Johnson possessed a Hi-Point JCP .40 caliber firearm loaded with seven rounds of .40 caliber ammunition. The handgun had a defaced serial number. Johnson sold the loaded firearm to another man inside a convenience store in Schenectady, New York, for $200. Johnson, after asking if the firearm would be used “to book somebody,” showed the man how to operate the firearm so that he could “handle his business,” and repeatedly warned him not to lose the “hammer.”This prosecution resulted from an investigation by the Capital District Safe Streets Task Force, which includes members of the FBI, Bureau of Alcohol, Tobacco, Firearms & Explosives, the New York State Police, the Schenectady Police Department, the Schenectady County District Attorney’s Office, the New York State Department of Corrections and Community Supervision, the Albany County Sheriff’s Office, and the New York Air National Guard.
The case is being prosecuted by Assistant United States Attorney Wayne A. Myers.
Savannah Man Convicted of Armed Robbery of Wells Fargo Bank BranchRead the Press Release
SAVANNAH, GA: On January 11, 2017, following a two-day trial before U.S. District Judge William T. Moore, Jr., a federal jury convicted Lamarlvin Arkeena Watts, 22, of armed bank robbery and brandishing a firearm during a crime of violence.
According to the evidence presented at trial, Watts veiled himself with a camouflage bandana and invaded the Wells Fargo branch at 1900 E. Victory Drive in Savannah at approximately 10:10 a.m. on July 14, 2015. With his finger on the trigger of a semiautomatic pistol, Watts threatened to shoot two of the bank’s tellers if they refused to surrender the cash in their control. Although Watts made off with more than $2,300.00, he was quickly identified as the perpetrator and arrested the following day. Searches of Watts’ house and vehicle revealed the shoes and one of the disposable gloves worn during the robbery, several hundred dollars of cash, and more than a dozen rounds of ammunition compatible with the gun Watts used to threaten the tellers. Hours after the robbery, Watts hired a convicted felon to cover up distinctive tattoos on his throat and forehead that were visible in the bank’s surveillance video footage, which law enforcement had disseminated through the media to enlist the public’s assistance in identifying the robber.
For his commission of armed bank robbery, Watts faces a term of imprisonment of up to 25 years, a fine of up to $250,000, and up to five years of supervised release. He must also make restitution to Wells Fargo. For brandishing a firearm during the bank robbery, Watts will be required to serve at least 7 additional years in prison. There is no parole in the federal system.
United States Attorney Edward J. Tarver stated, “Savannah is the Hostess City of the South; not the Wild West. This office will continue to aggressively prosecute violent offenders who endanger the community through their criminal misuse of firearms.”
The Federal Bureau of Investigation, the FBI’s Southeast Georgia Violent Crimes Task Force, and the Savannah-Chatham Metropolitan Police Department investigated the robbery with substantial assistance from the ATF and the GBI’s Division of Forensic Sciences.
Assistant United States Attorneys Theodore S. Hertzberg and Tania D. Groover prosecuted the case on behalf of the United States. For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.
Rochester Man Sentenced to Prison in Jamaican Lottery Scam CaseRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y.- Acting U.S. Attorney James P. Kennedy, Jr. announced today that Roydel Nicholson, 64, of Rochester, NY, was convicted following a jury trial of mail fraud and international money laundering for his role as a money-mule in the Jamaican lottery scam, was sentenced by U.S. District Judge David G. Larimer to 87 months in prison. The defendant will also be required to pay restitution in the amount of $145,794.
Assistant U.S. Attorney John J. Field, who prosecuted the case, stated that between December 2012 and January 2014, Nicholson acted as a money-mule in the Jamaican lottery scam, which targeted the elderly and vulnerable. In this role, the defendant received packages of cash and bank checks via the U.S. mail totaling more than $145,000. The cash and checks came from a 95-year-old victim in California. Nicholson then forwarded some of the money to other members of the scam in Jamaica and elsewhere, and kept the remainder for himself.
The Jamaican Lottery Scam is a widespread fraud that targets the vulnerable elderly in this country. Typically, telemarketers based in Jamaica call victims while disguising their true telephone numbers using various techniques, tell the victims that they have won a multimillion dollar lottery prize, and tell them that in order to receive their winnings they need to send money to pay for taxes, fees, or other purported expenses. The victim is commonly directed to send the money to a U.S.-based person, the money-mule, who collects the money, takes a cut of the proceeds, and forwards the rest to the organizers of the fraud. According to estimates published by news outlets, American victims have been sending approximately $300 million a year to Jamaica as a result of this fraud.
The sentencing is the result of an investigation by Inspectors with the United States Postal Inspection Service, acting under the direction of Shelly Binkowski, Inspector-In- Charge, Boston Division, and Special Agents with Immigration and Customs Enforcement, Homeland Security Investigations, acting under the direction of James Spero, Special Agent-In-Charge, Buffalo Division.
Rochester Man Sentenced for Failing to Pay Federal Income TaxesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y. - Acting U.S. Attorney James P. Kennedy, Jr. announced today that David Mura, 67, of Rochester, NY, who was convicted of failing to file federal income tax returns, was sentenced by U.S. Magistrate Judge Marian W. Payson to one year in prison. The defendant was also ordered to pay the Internal Revenue Service $300,636.82.
According to Assistant U.S. Attorney John Field, who handled the case, Mura worked as an investment advisor with local brokerage firms, and earned significant money in commissions and other income. Despite knowing that he was required to report such income, and pay taxes on it, the defendant failed to file any federal tax returns for 2009, 2010, 2011, and 2012.
The sentencing is the culmination of an investigation by Special Agents of the Internal Revenue Service, Criminal Investigations, under the direction of Acting Special Agent-in-Charge Kathy A. Enstrom, New York Field Office.
Remarks by U.S. Attorney Zachary T. Fardon at News Conference on Investigation of Chicago Police DepartmentRead the Press Release
Thank you Vanita. I am grateful to you, Attorney General Lynch, and to all of the outstanding women and men from the Civil Rights Division and my Office who have spent the last 13 months working so hard to make today happen.
Today, history is made, and it couldn’t come at a more important time. The past year has been among the most brutal in Chicago memory. Gun violence has overwhelmed us. We have been thunderstruck with grief and heartbreak, fear and confusion, uncertainty and sadness. Today’s findings, coupled with the City and Chicago Police Department’s commitment to work with us toward sustained change, are an historic turning point, a major step forward.
This is hard. I’m in law enforcement and have spent much of my career working with CPD. They are a noble institution with thousands of wonderful and brave public servants. The bad officers are fewer; the good officers are many.
But the institution as a whole has some challenges, and those challenges are getting in the way of being as good as we can be at fighting crime. I have seen that first hand.
The first step is taking an honest look at what’s wrong. And to be clear, that doesn’t mean pointing fingers or casting blame; that’s not what this is about. It’s about what an incredibly challenging job it is to be a police officer, and making sure that our police officers have what they need to do the job right.
As Vanita and the Attorney General both mentioned, the City and CPD have not stood still while we conducted this review. I want to thank and commend the City, Mayor Emanuel, Superintendent Johnson, and the many others at CPD and the City who have worked hard and thoughtfully over this past year or more. They have led, and are leading a number of new reforms and efforts to address some of these deficiencies.
In our report, we address each of those new measures -- in some cases simply with applause, because we agree with them; in other cases, by pointing out how or where we find the measures to be insufficient or inadequate. Those critiques, while important, do not detract from the reality that the City and CPD have leaned forward and are pushing for change. And with the City and CPD’s agreement today, we now have a framework – an anticipated Consent Decree that will include an Independent Monitor – for not only making sure change happens, but making sure it sticks.
Let me emphasize that point. The deficiencies we found are longstanding, some decades old. Prior reform efforts in Chicago’s history -- and there have been many -- have not gotten the job done. And over the years, these festering problems have impacted and to a degree even come to define CPD’s culture.
CPD officers need and deserve what the citizens of Chicago want and deserve: a culture of excellence; a culture of integrity; a culture of altruism; a culture of pride in public service. Today is a big step toward manifesting that culture. And I again thank the Superintendent and the Mayor, as well as their leadership teams, for being part of that.
There has been, over the past couple years, a lot of pain and polarization about policing. There are those who are very skeptical about police and want a complete overhaul. And there are those who think that police, particularly in a violence-ridden city, don’t need any reform and should be unfettered by scrutiny.
Neither. There is so much about CPD that is great and worthy of our deepest respect. And yet no one is above scrutiny, especially our public institutions. This report is balanced, and the truth lies in the balance. Today’s findings are consistent with a police force that is proactive, vigilant and effective. One is a means to the other. I strongly believe implementing these findings is a necessary precursor to our long-term fight against violent crime in Chicago.
Chicago is a world class city that faces a tragic and challenging reality in the form of our gun violence epidemic. Especially last year, but for decades now, we have had too many people die from gun violence; too many kids struck by errant bullets; and entire neighborhoods on the south and west sides unfairly, disproportionately afflicted by gun violence. I spend a large chunk of every day working with CPD and others to stop gun violence in those neighborhoods. For over three years, that is what has kept me up at night. And one thing I have learned is that for us to succeed, we need to fix these systemic issues at CPD.
When officers do bad things and there’s no accountability, that hurts us all. It erodes trust. And when you repeat that pattern year after year, that breaks trust. Broken trust seriously impairs law enforcement. As Superintendent Johnson has said, if folks don’t trust and respect CPD, they won’t work with CPD. If victims, victims’ families, and witnesses across entire communities won’t provide information to help solve crimes and take violent criminals off the street, then crimes don’t get solved, and violence continues.
Today, with the City and CPD, we begin to fix that paradigm. By providing CPD officers first-class training, proper supervision, a promotion system that is fair and is perceived to be fair. By having an accountability system, with consistent rules and results, that holds officers accountable when they violate law or policy. By doing those things we rebuild trust and repair relationships, and make Chicago safer and stronger.
I am a public servant who believes police officers are the noblest of our public servants. They are women and men who’ve taken a job at modest pay where every day they wake up not knowing if they may get hurt or even killed. I’ve been in law enforcement most of my career, and I know that the vast majority of officers do that for this simple reason: they are good people; they care; they want to serve and protect; they want to love and live impactful lives as part of our community.
It’s time to give them what they need to succeed, and in doing so, help all of Chicago shine.
I’d like to turn it over to Mayor Rahm Emanuel, who’ll make some remarks, followed by Superintendent Eddie Johnson.
Remaining Two "Snap" Fraud Conspirators Sentenced to Prison and Ordered to Pay over $700k in RestitutionRead the Press Release
GRAND RAPIDS, MICHIGAN — U.S. Attorney Patrick Miles announced that Cruz Gonzalez, of Shelby, Michigan, was sentenced to 33 months in prison and ordered to pay restitution of $722,149 to the Department of Agriculture by U.S. District Court Judge Gordon J. Quist. Her daughter, Fabiola Garcia, was sentenced the same day to 20 months in prison and also ordered to pay $722,149 in restitution. The two conspired to defraud the Supplemental Nutrition Assistance Program (SNAP), formerly known as the food stamp program, by illegally exchanging SNAP benefits for cash, cell phones, and other ineligible items at La Fortuna Carniceria in Shelby, Michigan. The total amount of fraud was determined to be $722,149, covering the period of February 2008 through January 2014.
U.S. Attorney Miles stated, "The federal government cannot tolerate the theft of federal program benefits meant to aid low income individuals meet daily nutritional needs. Such theft undermines the public’s confidence in the SNAP program and diminishes the government’s ability to provide food assistance to those citizens most in need."
Gonzalez and Garcia were two of three conspirators charged and convicted in the conspiracy. The third, Gisela Mendoza, also a daughter of Gonzalez, was sentenced in November to six months in prison, two months of home detention, and restitution of $722,149.
A joint investigation led by the U.S. Department of Agriculture Office of Inspector General and the Michigan State Police SSCENT team resulted in the federal charges.
END
Registered Sex Offender with Two Prior Convictions Sentenced to 15 Years in Prison for Receipt of Images of Child RapeRead the Press Release
A 52-year-old registered sex offender was sentenced today in U.S. District Court in Seattle to 15 years in prison for receipt of child pornography, announced U.S. Attorney Annette L. Hayes. SCOTT MITCHELL COHEN of Seattle was arrested on January 16, 2016, following an investigation by the Seattle Police Department and U.S. Immigration and Customs Enforcement’s Homeland Security Investigation. The investigation revealed that COHEN had more than 600 images and videos of child pornography and had twice been convicted of crimes involving the sexual abuse of children. At sentencing Chief U.S. District Judge Ricardo S. Martinez imposed a lifetime period of supervised release.
According to records filed in the case, the investigation began when Google alerted the National Center for Missing and Exploited Children (NCMEC) the images of child sexual abuse had been uploaded via a google email account. The IP address used was a Seattle Public Library address and later a University District Café wifi site. Through diligent police work tracing false identities used for on line and cell phone accounts detectives were ultimately able to identify COHEN as the user of the email account. When a search warrant was executed on his University District apartment, law enforcement discovered more than 600 images of child pornography on various computers, phones and other electronic devices. COHEN was convicted in 2005 of molesting a female under the age of 12. COHEN was ordered into extensive sexual deviancy treatment. Following treatment, he was convicted in 2010 of a second sex offense, possession of child pornography. COHEN was on state probation for that offense when arrested in this case. The investigation also uncovered that COHEN had been texting with a Texas teenager, attempting to get her to send him sexually explicit images.
In asking for lifetime supervised release, prosecutors wrote to the court: “The defendant has demonstrated that he poses a threat to the safety and well-being of minors in our communities. Despite negative contact with law enforcement and convictions for sex offenses, the defendant has demonstrated that he is either unwilling or unable to abide by society’s rules concerning sexual contact and interactions with minors. The defendant has demonstrated nearly two decades of unacceptable criminal sexual behaviors towards minors. Anything less than lifetime supervision inadequately protects the community.”
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.justice.gov/psc
The case was investigated by the Seattle Police Department and U.S. Immigration and Customs Enforcement’s Homeland Security Investigation (HSI) as part of the Internet Crimes against Children Task Force (ICAC).
The case was prosecuted by Special Assistant United States Attorney Cecelia Gregson. Ms. Gregson is a Senior Deputy King County Prosecutor specially designated to prosecute child exploitation cases in federal court.
Preston County man sentenced for unlawful possession of a firearmRead the Press Release
CLARKSBURG, WEST VIRGINIA – Scott Alan Thomas, 53, of Masontown, West Virginia, was sentenced in federal court today to 41 months incarceration for illegally possessing a firearm, Acting United States Attorney Betsy Steinfeld Jividen, announced.
Thomas, who had previously been convicted of felony offenses in Ohio and Florida, was discovered in possession of a .22 caliber revolver in December 2015. He pled guilty to one count of “Felon in Possession of a Firearm” in September 2016.
Assistant United States Attorney Shawn M. Adkins prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms, and Explosives, the West Virginia State Police, and the Masontown Police Department investigated.
U.S. District Judge Irene M. Keeley presided.
Pollock prisoner from Texas pleads guilty to assaulting fellow inmateRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced that a Pollock prisoner pleaded guilty Wednesday to assaulting another inmate.
John Garza, 33, a prisoner at the U.S. Penitentiary in Pollock, La., who is from Gonzales, Texas, pleaded guilty before U.S. District Judge Dee D. Drell, to one count of assault resulting in serious bodily injury. According to the guilty plea, Garza assaulted a fellow inmate on July 31, 2016, by stabbing him in the neck and back area. Video cameras showed Garza attacking a fellow inmate pushing him to the ground. He then stabbed and tramped on the inmate. The inmate was later brought to a local hospital where he was treated for severe injuries.
Garza faces up to 10 years in prison, three years of supervised release and a $250,000 fine. A sentencing date of April 12, 2017 was set.
The FBI and U.S. Bureau of Prisons investigated the case. Assistant U.S. Attorney Tennille M. Gilreath is prosecuting the case.
Pittsburgh Man Sentenced to Prison for Violating Federal Drug and Gun LawsRead the Press Release
PITTSBURGH – Eric Wormsley was sentenced to 93 months in prison for heroin trafficking and firearms crimes, Acting United States Attorney Soo C. Song announced today.
Wormsley, age 38 of Pittsburgh, Pennsylvania, was also sentenced to serve six years of supervised release following his prison term. He was convicted of possession of over 50 grams of heroin with intent to distribute and possession of a loaded and stolen .45 caliber pistol in furtherance of that drug trafficking crime on Feb. 6, 2015. On that date, probation officers found Wormsley’s loaded pistol and his heroin stored in his young children’s bedroom within feet of where the children slept. Wormsley was on probation at the time following a prior conviction for simple assault of a police officer. He was previously convicted in federal and state court of committing heroin trafficking and firearms crimes in several cases over the last 20 years.
Assistant United States Attorney Craig W. Haller prosecuted this case on behalf of the United States.
The Pittsburgh Bureau of Police, the Allegheny County Probation Office, and the Drug Enforcement Administration conducted the investigation leading to the convictions in this case. The investigation was funded by the federal Organized Crime Drug Enforcement Task Force Program (OCDETF). The OCDETF program supplies critical federal funding and coordination that allows federal and state agencies to work together to successfully identify, investigate, and prosecute major interstate and international drug trafficking organizations and other criminal enterprises.
Pensacola Man Sentenced to 3 Years for Making False Statements Regarding His Support and Promotion of ISILRead the Press Release
PENSACOLA, FLORIDA – Robert Blake Jackson, 31, of Pensacola, was sentenced to 3 years in federal prison today for making materially false statements in a federal investigation. The sentence was announced by Christopher P. Canova, United States Attorney for the Northern District of Florida.
In October 2014, Jackson’s Facebook profile contained comments, photos, and videos expressing support for extremist terrorist groups such as the Islamic State of Iraq and the Levant (ISIL, also known as ISIS). This included graphic ISIL videos promoting the execution of those who oppose ISIL. In January 2015, a Pensacola telemarketing corporation reported they had recently fired Jackson for viewing ISIL related and other terrorist related websites and videos on his work computer.
In June 2015, during an interview with the FBI, Jackson stated that he never posted any pro-ISIL or violent content, and that he only used the internet at work to search news sites. Upon his arrest in July 2016, Jackson was in possession of an electronic tablet that contained the most recent addition of Dabiq, an ISIL recruitment magazine, as well as audio lectures of Anwar al-Awalki. At his plea hearing on September 23, 2016, Jackson admitted that the statements he made to federal agents were false.
“Our law enforcement agencies work around the clock to keep us safe,” said U.S. Attorney Canova. “The United States Attorney’s Office will vigorously prosecute those who provide false statements to federal agents, because false statements divert precious time and resources from the furtherance of important criminal investigations.”
This case resulted from an investigation by the Federal Bureau of Investigation, the Internal Revenue Service – Criminal Investigation, the Florida Department of Law Enforcement, and the other members of the FBI Joint Terrorism Task Force. Assistant United States Attorney David L. Goldberg prosecuted the case, with the assistance of David Cora of the National Security Division.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access available public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
For more information, contact:
Amy Alexander, Public Information Officer(850) 216-3854, [email protected]
Paramedic Pleads Guilty to Tampering with DrugsRead the Press Release
TULSA, Okla.— Sara Nicole Hogsett, 26, plead guilty to Tampering with Consumer Products, announced Danny C. Williams Sr., United States Attorney for the Northern District of Oklahoma. United States District Court Judge James H. Payne will sentence Hogsett on April 26, 2017.
From April 2016 to May 2016, Hogsett, a paramedic, took pain medication: fentanyl, morphine and diazepam, from her assigned ambulances by removing the liquid drugs from their vials. Hogsett used the drugs on herself and replaced the removed liquid with saline solution. Agents from the United States Food and Drug Administration (FDA) confronted Hogsett about the vials and she admitted to the agents that she tampered with them.
"FDA oversees the U.S. supply of medicines to ensure that they are safe and effective, and those who knowingly tamper with medicines for patients put their health at risk," said Spencer E. Morrison, Special Agent in Charge, FDA Office of Criminal Investigations' Kansas City Field Office. "Our office will continue to pursue and bring to justice those who violate laws designed to protect the public health."
This case was investigated by the FDA. Assistant United States Attorney Neal C. Hong prosecuted the case.
Panama City Title Agent Pleads Guilty to Bank Fraud and Conspiracy ChargesRead the Press Release
PANAMA CITY, FLORIDA – Patricia Lynn Smith, 55, of Panama City Beach, pled guilty today to six felony counts, including one count of conspiracy to commit bank fraud and/or mail fraud affecting a financial institution and five counts of bank fraud. The guilty plea was announced by Christopher P. Canova, United States Attorney for the Northern District of Florida.
Smith pled guilty surrounding conduct she engaged in while she was the manager of Northwest Florida Title Services. Smith participated in a scheme to defraud and obtain money and/or property by fraudulent means from the federally insured financial institutions Bank of America, First Tennessee Bank, JP Morgan Chase Bank, MetLife Bank, and Wells Fargo Bank. As a part of the scheme, Smith signed HUD-1 forms and caused them to be submitted to these financial institutions. The forms falsely claimed buyers were providing cash to purchase residences located in Panama City Beach and elsewhere, when this money was actually coming from a third party. During the course of the scheme, mortgage loans totaling in excess of $6 million on at least 18 pieces of real property were closed by Smith and Northwest Florida Title Services.
On each count, Smith faces a maximum of 30 years in prison, a maximum of a $1 million fine, and restitution. Smith is scheduled to be sentenced on March 30, 2017.
The case was investigated by the Office of Inspector General, Federal Housing Finance Agency and the Florida Department of Law Enforcement. This case is being prosecuted by Assistant U.S. Attorney Tiffany H. Eggers.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access available public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
For more information, contact:
Amy Alexander, Public Information Officer
(850) 216-3854, [email protected]Palm Beach County Resident Sentenced to 5 Years in Prison for Attempting to Receive Child PornographyRead the Press Release
Daniel Tyler Morgan, 30, of Jupiter, Florida, was sentenced today by United States District Judge Robin Rosenberg to 60 months in prison, to be followed by 5 years of supervised release for attempting to receive sexually explicit images of a child. Previously, on October 12, 2016, Morgan pled guilty to one count of attempting to receive sexually explicit images of a child.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Mark Selby, Special Agent in Charge, U.S. Immigration and Customs Enforcement, Homeland Security Investigations (ICE-HSI), and Chief John Bolduc, Port St. Lucie Police Department, made the announcement.
According to the court record, Morgan was a history teacher at St. Lucie West Centennial High School in Port St. Lucie, Florida, when he began communicating over the internet with a minor student whom he had taught the previous year. Over a period of three months, Morgan cultivated an increasingly personal online relationship with the student. Morgan began soliciting sexually explicit photographs from the minor and sent the student a sexually explicit image of himself. Morgan also encouraged the minor to join him in smoking marijuana. Morgan is no longer employed as a teacher with the school district.
Mr. Ferrer commended the investigative efforts of ICE-HSI and the Port St. Lucie Police Department. The case was prosecuted by Special Assistant U.S. Attorney Ryan Butler and Assistant U.S. Attorney Daniel Funk.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Ocean County, New Jersey, Man Sentenced to 10 Years in Prison for Robbing Eight BanksRead the Press Release
TRENTON, N.J. – An Ocean County, New Jersey, man was sentenced today to 120 months in prison for robbing eight banks in New Jersey and New York, U.S. Attorney Paul J. Fishman announced.
Steven Wisnowski, 33, of Barnegat, New Jersey, previously pleaded guilty before U.S. District Judge Peter J. Sheridan in Trenton federal court to an eight-count superseding information charging him with the bank robberies.
According to documents filed in this case and statements made in court:
Wisnowski admitted that between Oct. 30, 2013, and Jan. 7, 2014, he robbed eight banks, seven of which were in New Jersey, and one of which was in New York:
Bank Name
Location
Date
PNC Bank
Edison
Oct. 30, 2013
TD Bank
Brick
Nov. 7, 2013
Santander Bank
Brick
Nov. 15, 2013
Ridgewood Savings Bank
Bayside (NY)
Nov. 22, 2013
Columbia Bank
Edison
Nov. 27, 2013
TD Bank
Toms River
Dec. 2, 2013
PNC Bank
Aberdeen
Dec. 9, 2013
Fulton Bank
Edison
Jan. 7, 2014
Wisnowski used a similar procedure for each robbery: he entered the banks wearing hats, hooded jackets, and wigs to conceal his identity, approached the bank tellers, and demanded money. In some instances, Wisnowski made the tellers believe he was armed and also threatened some tellers with violence.
During the Columbia Bank robbery, Wisnowski appeared to point something at the teller from under his clothing, as if he had a gun. Wisnowski then demanded money, stating: “Give me all your hundreds.” As the teller gathered the money, Wisnowski counted backwards from 10. He then fled with the money.
During the Fulton Bank robbery, Wisnowski gave a teller a manila envelope and stated, “Give me what I want and nobody gets hurt. I want large bills.” He then pulled up his sweatshirt as if he had a gun. The teller gathered the money and placed it in the envelope, after which Wisnowski fled.
Law enforcement tracked Wisnowski’s vehicle to the scene of the Fulton Bank robbery. Officers approached Wisnowski as he exited the bank and ordered him to the ground at gunpoint. Wisnowski threw the envelope filled with cash and fled. Law enforcement officers pursued Wisnowski and apprehended him moments later.
In addition to the prison term, Judge Sheridan sentenced Wisnowski to three years of supervised release and ordered to pay restitution of $22,240.
U.S. Attorney Fishman praised special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation leading to today’s sentencing. He also thanked the Edison, Aberdeen, Brick, Toms River, and New York City police departments, and the Middlesex, Ocean, and Monmouth County prosecutors’ offices for their contributions to the case.
The government is represented by Assistant U.S. Attorney Jamari Buxton of the U.S. Attorney’s Organized Crime/Gangs Unit in Newark.
Defense counsel: Chester Keller Esq., Assistant Federal Public Defender, Newark
Nassau County Man Sentenced for Receiving Child Sex Abuse Videos over the InternetRead the Press Release
Jacksonville, Florida – United States District Judge Brian J. Davis has sentenced Clement Ashford Reeves, Jr. (74, Yulee) to five years in federal prison for receiving videos over the Internet depicting children being sexually abused. He was also ordered to serve a five-year term of supervised release upon his release, to forfeit his computer media, and to register as a sex offender.
According to court documents, an agent with U.S. Immigration and Customs Enforcement’s Homeland Security Investigations began an undercover operation to identify persons using the Internet to receive and share child pornography. The agent learned that a host computer in Florida had been sharing child pornography since December 15, 2011. That computer was traced to Reeves’s residence.
On June 3, 2015, agents met with Reeves at his home. During an interview, Reeves stated that he had downloaded depictions of prepubescent children, but his preference was for young girls. He also said that he had been using the file sharing program for 10-15 years. Agents seized several computer devices that contained 22 videos depicting young children being sexually abused.
This case was investigated by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. It was prosecuted by Assistant United States Attorney D. Rodney Brown.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Montana Man Sentenced in Second Attempt to Hire Someone to Kill His Former WifeRead the Press Release
Contact Person: Lance Crick (864) 282-2100
Columbia, South Carolina ---- United States Attorney Beth Drake stated today that Shane Douglas Sichting, Jr., age 48, originally from Montana, and recently serving a 10-year sentence at Federal Correctional Institute, Edgefield, South Carolina, was sentenced in federal court by United States District Judge Bruce Howe Hendricks of Charleston, to 135 months imprisonment, on charges of use of interstate commerce facilities in the commission of murder for hire and retaliating against an informant, violations of Title 18, United States Code, Section 1958(a) and 1513(a)(1).
On September 1, 2016, Sichting entered a guilty plea to the charges. Evidence presented at the change of plea hearing established that Sichting was tried, convicted and sentenced in United States District Court for the District of Montana on a murder for hire charge in 2007. Sichting’s intended victim was his now former wife. The individual he hired to kill his wife reported Sichting’s actions to the FBI and testified at his trial in Montana. Following his conviction, Sichting was sentenced to 10 years imprisonment and was serving the last part of that sentence at FCI, Edgefield in July 2015.
During July 2015, Sichting approached another inmate at FCI, Edgefield about killing his former wife and the person he hired to kill her. The inmate agreed to help Sichting but instead contacted the FBI and advised them of Sichting’s intentions to hire someone to kill his former wife and the informant/witness against him. Sichting specifically wanted the murders to take place prior to his anticipated release to a halfway house in January 2016.
The FBI devised a plan to have the inmate provide Sichting with a telephone number for a “hitman” that was willing to do the murders. Sichting was to contact the hitman by telephone to make arrangements for the murders. In actuality, the hitman was an FBI employee acting in an undercover capacity.
Through these telephone calls and mail correspondence, Sichting provided the hitman with confidential information relating to the intended victims. Sichting used predetermined coded language to communicate with the hitman, referring to each of the intended victims as certain makes of cars. He also negotiated the price to be paid for each of the murders.
The case was investigated by agents of the Federal Bureau of Investigation (FBI) and the Bureau of Prisons. Assistant United States Attorney Jeanne Howard of the Greenville office handled the case.
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Monroeville Resident Sentenced to 10 Months for Witness TamperingRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced today that Arthur Leyon Penn, 39, of Monroeville, Alabama, was sentenced today by Senior U.S. District Judge Callie V. S. Granade to 10 months imprisonment for tampering with a witness in his tax fraud case in U.S. District Court for the Southern District of Alabama. Senior Judge Granade ordered that 6 months of Penn’s prison term run concurrently with his 48-month sentence in his tax fraud case, that 4 months run consecutively with the sentence in his tax fraud case, and that he pay a $100 mandatory special assessment. Before imposing her sentence, Senior Judge Granade underscored the serious nature of the witness tampering conduct.
Penn led The Penn Agency LLC, a company based in Monroeville, Alabama that provided insurance and fraudulent tax preparation services. He co-owned The Penn Agency with his wife, co-defendant Oleavia Mitchell Penn, who operated another fraudulent tax preparation business, Quick Tax, in Camden, Alabama. In January 2016, Arthur Penn and five co-defendants were indicted by the Federal Grand Jury for the Southern District of Alabama. The indictment alleged that between 2011 and 2015, Penn orchestrated a fraudulent tax scheme and sought personal financial gain by defrauding the Treasury Department through the preparation and filing of fraudulent federal tax returns. On August 22, 2016, Arthur Penn pled guilty to two counts of aggravated identity theft in connection with the unlawful use of individuals’ social security numbers and the preparation and submission of fraudulent tax returns. That same day, Oleavia Penn also pleaded guilty before Senior Judge Granade to committing aggravated identity theft.
Later in August 2016, Arthur Penn was indicted by the Federal Grand Jury for the Southern District of Alabama on two counts of tampering with a material witness in his tax fraud case. On December 14, 2016, Arthur Penn pleaded guilty before Senior Judge Granade to one count of witness tampering. As part of his plea, he admitted to attempting to bribe a former employee at The Penn Agency to prevent her from testifying against him at trial in his tax fraud case. After Arthur Penn pleaded guilty to witness tampering, Senior Judge Granade sentenced him to 48 months imprisonment in his tax fraud case. Oleavia Penn’s sentencing date in the tax fraud case is March 15, 2017.
The tax fraud and witness tampering cases were investigated by the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigation, and the 35th Judicial Circuit Task Force in Monroeville, Alabama. The cases were prosecuted by Assistant United States Attorneys Sinan Kalayoglu and Greg Bordenkircher.
Mission Man Charged with Assaulting a Federal Officer and Domestic Assault by an Habitual OffenderRead the Press Release
United States Attorney Randolph J. Seiler announced that a Mission, South Dakota, man has been indicted by a federal grand jury for Assaulting, Resisting, Opposing, and Impeding a Federal Officer, and Domestic Assault by an Habitual Offender.
Quentin Provancial, II, age 31, was indicted on December 13, 2016. He appeared before U.S. Magistrate Judge Mark A. Moreno on December 29, 2016, and pled not guilty to the Indictment.
The maximum penalty upon conviction of Assault of a Federal Officer is up to 8 years in custody and/or a $250,000 fine, and 3 years of supervised release. The maximum penalty upon conviction of Domestic Assault by an Habitual Offender is up to 5 years in custody and/or a $250,000 fine, and 3 years of supervised release. A special assessment of $100 to the Federal Crime Victims Fund applies to each charge. Restitution may also be ordered.
The Indictment alleges that on October 15, 2016, Provancial did forcibly assault, resist, oppose, impede, intimidate, and interfere with a law enforcement officer from the Rosebud Sioux Tribe while he was engaged in the performance of his official duties. On that same day, Provancial did unlawfully commit a domestic assault upon an intimate partner, when at the time of the assault he had two final convictions for domestic abuse.
The charges are merely accusations and Provancial is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Carrie G. Sanderson is prosecuting the case.
Provancial was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has been set for March 7, 2017.
Minnesota Man Sentenced to 20 Years in Prison for Extortion Scheme That Spanned over Twenty YearsRead the Press Release
PHOENIX– Yesterday, U.S. District Judge Steven P. Logan sentenced Steven Dale Audette, 59, of Duluth, MN, to 240 months in prison and three years of supervised release for stealing approximately $3.5 million through an elaborate extortion scheme. Audette was found guilty by a federal jury on March 24, 2016, of one count of conspiracy and ninety counts of wire fraud. His co-defendant and wife, Mary Roach, had previously pleaded guilty to conspiracy and was sentenced to 33 months in prison.
Evidence at trial showed that Audette stole nearly $3.5 million from three victims in Scottsdale, Ariz., by falsely representing that Audette was on the run from the mafia and needed funds to pay the CIA and FBI for protection. Audette tormented the victims by threatening that if they did not provide money their family members, including children, would be murdered. The victims’ money was spent by Audette on cars, travel, homes, gifts to family and friends, and other personal items.
The scheme continued for over twenty years, with Audette escalating the threats and harm to the victims if they did not comply with his demands for money. Audette operated the scheme from Arizona, Minnesota, Texas, and Alabama, among other states.
“Through lies, deceit, and threats Audette took advantage of the generosity and vulnerability of the victims. We will vigorously pursue and bring to justice those who would defraud the public,” stated United States Attorney John S. Leonardo.
The investigation in this case was conducted by ATF, IRS and the Marion Country Sherriff’s Office in Chattanooga, Tenn. The prosecution was handled by Kevin M. Rapp and Andrew C. Stone, Assistant U.S. Attorneys, District of Arizona, Phoenix.
CASE NUMBER: CR-14-00858-PHX-STL
RELEASE NUMBER: 2017-002_ Audette etal
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.
Meridian Man Pleads Guilty to Possession of Firearm While Under IndictmentRead the Press Release
Jackson, Miss – Javeon Malik Davis, 20, from Meridian, Mississippi, pleaded guilty before Senior U.S. District Judge David C. Bramlette III on January 10, 2017 to possessing a firearm while under felony indictment, announced U.S. Attorney Gregory K. Davis.
Javeon Davis admitted to possessing a firearm on May 19, 2016 in Meridian, at a time in which he was under felony indictment in Lauderdale County for having possessed a stolen firearm. Officers with the Meridian Police Department responded to a shots fired call and saw the defendant, Javeon Davis, toss a firearm into the back seat of a nearby vehicle. Officers located the weapon and the defendant admitted to possessing the firearm.
Davis will be sentenced on April 4, 2017, and faces a maximum penalty of 5 years in prison and a $250,000 fine.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives along with the Meridian Police Department. It is being prosecuted by Assistant U.S. Attorney Abe McGlothin, Jr.
Medstar Ambulance to Pay $12.7 Million to Resolve False Claims Act Allegations Involving Medically Unnecessary Transport Services and Inflated Claims to MedicareRead the Press Release
Medstar Ambulance Inc., including four subsidiary companies and its two owners, Nicholas and Gregory Melehov, have agreed to pay $12.7 million to resolve allegations that the Massachusetts-based ambulance company knowingly submitted false claims to Medicare, the Department of Justice announced today.
“We expect those who participate in the Medicare program to provide services, including ambulance services, based on the medical needs of patients rather than their desire to maximize profits,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “The Department of Justice is committed to ensuring that those who abuse the Medicare program will be held accountable for their actions.”
The settlement resolves allegations that from Jan. 1, 2011, through Oct. 31, 2014, Medstar submitted false claims to Medicare for ambulance transport services. Specifically, the United States alleged that Medstar routinely billed for services that did not qualify for reimbursement because the transports were not medically reasonable and necessary, billed for higher levels of services than were required by patients’ conditions, and billed for higher levels of services than were actually provided.
“Our office is committed to finding and eradicating Medicare fraud wherever it occurs,” said U.S. Attorney Carmen Ortiz for the District of Massachusetts. “While we recognize that Medicare does and should pay for medically necessary ambulance services, it is our job to ensure that ambulance providers do not take advantage of the system or the patients. This settlement is part of the office’s ongoing effort to eradicate health care fraud, and return money to the taxpayers.”
As part of the settlement today, Medstar has agreed to a corporate integrity agreement with the U.S. Department of Health and Human Services (HHS).
“Ambulance service companies should be focused on the needs of the patients,” said HHS Office of Inspector General Special Agent in Charge Phillip Coyne. “Billing Medicare for ambulance rides that were unnecessary or at a higher rate than could be medically justified is unacceptable. Together with our law enforcement partners, we will seek out and stop this fraudulent behavior.”
The allegations were filed in a lawsuit by Dale Meehan, a former employee in Medstar’s billing office, under the whistleblower provisions of the False Claims Act. Those provisions allow private individuals to sue on behalf of the United States and to share in the proceeds of any settlement or judgment. Meehan will receive approximately $3.5 million.
This settlement is the result of a coordinated effort by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the District of Massachusetts, the FBI, and HHS, Office of Audit Services and Office of Inspector General.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $31.4 billion through False Claims Act cases, with nearly $19.6 billion of that amount recovered in cases involving fraud against federal health care programs.” Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).
The case is captioned United States ex rel. Meehan v. Medstar Ambulance. Inc., et al., No. 13-CV-12495-IT (D. Mass). The claims settled by this agreement are allegations only; there has been no determination of liability.
Medical Imaging Provider Sentenced for Federal Health Care FraudRead the Press Release
TOPEKA, KAN. B A man who owned a medical imaging business was sentenced Thursday to 18 months in federal prison for health care fraud, U.S. Attorney Tom Beall said. In addition, the defendant was ordered to pay more than $1.5 million in restitution to Medicare and Medicaid.
Cody Lee West, 38, Paragould, Ark., owner of C & S Imaging, Inc., pleaded guilty to one count of health care fraud. C & S Imaging was a mobile independent diagnostic testing facility that provided ultra sound diagnostic testing to health care providers.
In his plea, West admitted he solicited chiropractors and told them he could provide equipment and an operator at no cost to them. West fraudulently billed Medicare for musculoskeletal exams and Doppler scans that allowed him to receive up to $410 per patient for services that were not ordered by a physician, not medically necessary, not performed or not documented. He also used fraudulent methods to attempt to provide documentation for some of his bills.
Beall commended the Department of Health and Human Services, the Kansas Attorney General’s Medicaid Fraud Division and Assistant U.S. Attorney Tanya Treadway for their work on the case.
McLaughlin Man Sentenced for Tampering with a WitnessRead the Press Release
United States Attorney Randolph J. Seiler announced that a McLaughlin, South Dakota, man convicted of Tampering with a Witness, Victim, or an Informant was sentenced on January 5, 2017, by U.S. District Judge Charles B. Kornamnn.
Todd Stands Alone, f/k/a Todd Brave Crow, age 37, was sentenced to 36 months in custody, 1 year of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Stands Alone was indicted by a federal grand jury on February 11, 2015. He pled guilty on July 18, 2016.
The conviction stems from an incident on the evening of January 23, 2015, when the juvenile victim reported to her family that she had been beaten up by an adult family member while she was babysitting. Upon relaying these events to her family, the victim was immediately told not to report this incident to anyone. Stands Alone told the victim on numerous occasions not to speak to anyone about the incident, harassing the victim to the point that she did not know who she could trust. Stands Alone also persuaded his mother and others in the family to pressure the victim into not speaking to authorities or contact anyone regarding the incident. This harassing behavior continued for multiple days.
This case was investigated by the Bureau of Indian Affairs, Standing Rock Agency. Assistant U.S. Attorney Troy R. Morley prosecuted the case.
Stands Alone was immediately turned over to the custody of the U.S. Marshals Service.
McLaughlin Man Sentenced for Domestic Assault by an Habitual OffenderRead the Press Release
United States Attorney Randolph J. Seiler announced that a McLaughlin, South Dakota, man convicted of Domestic Assault by an Habitual Offender was sentenced on January 5, 2017, by U.S. District Judge Charles B. Kornmann.
Jason Martinez, age 41, was sentenced to 120 months in custody, 3 years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Martinez was indicted by a federal grand jury on January 21, 2016. A Superseding Indictment was filed on July 19, 2016. He pled guilty on August 15, 2016.
The conviction stems from an incident on December 8, 2016, when Martinez and his girlfriend, the victim, were socializing with several friends at a residence in McLaughlin.
Following an argument, the victim returned to her residence and went down to the basement to gather her belongings. As she was in the basement gathering her things, the victim heard a noise behind her and when she turned and looked, she saw Martinez standing there. Martinez made a disparaging remark to the victim and he started to hit her repeatedly. He hit her all about her head, face, and legs. In addition, Martinez repeatedly threw her down to the ground and struck her repeatedly in the back.
The victim tried to remain curled up in a ball in the corner to avoid further injury, however, Martinez grabbed her, tearing a portion of the victim’s clothes. Martinez continued to strike her about the head, and as a result there was so much blood coming down her face that she was having a hard time seeing. Martinez would not stop hitting her.
As a result of the assault, the victim sustained multiple cuts, bruises, scrapes, and abrasions. The lacerations to her scalp were so deep that her skull was visible through the wound site. The victim needed stitches to close the wound from the various lacerations she had sustained.
This case was investigated by the Federal Bureau of Investigation and the Bureau of Indian Affairs, Standing Rock Agency. Assistant U.S. Attorney Troy R. Morley prosecuted the case.
Martinez was immediately turned over to the custody of the U.S. Marshals Service.
Master’s Degree Student Pleads Guilty to Attempting to Entice a MinorRead the Press Release
A Rome, New York, man pleaded guilty today to charges of attempted coercion and enticement of a minor to engage in unlawful sexual activity.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; U.S. Attorney Dana J. Boente of the Eastern District of Virginia; and Colonel Edwin C. Roessler Jr., Chief of the Fairfax County, Virginia, Police Department made the announcement.
Julio Perez-Torres, 26, pleaded guilty before U.S. District Judge Liam O’Grady of the Eastern District of Virginia. Sentencing is scheduled for May 12, 2017.
According to admissions made in connection with his plea agreement, in early February 2016, Perez-Torres, a master’s degree candidate at American University, posted a Craigslist ad, expressing an interest in sex with children. When an undercover Fairfax County police officer replied to the ad, portraying himself as the father of two children, five and seven years old, Perez-Torres discussed performing graphic sexual acts on the children. On Feb. 18, 2016, after weeks of corresponding with the officer via sexually explicit emails, text messages and telephone calls, the defendant traveled to meet the undercover officer with the intent to engage in sexual acts with the children. Perez-Torres was arrested at that time.
Trial Attorney James E. Burke IV of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Kellen Dwyer of the Eastern District of Virginia are prosecuting the case.
This investigation was a 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.justice.gov/psc.
Manhattan Woman Pleads Guilty in Manhattan Federal Court to Commodities Fraud in Connection with Scheme to Defraud Investors of More Than $23 MillionRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that HAENA PARK pled guilty in Manhattan federal court today to commodities fraud. The charge relates to PARK’s scheme to defraud more than 40 individual investors out of more than $23 million. PARK solicited investments for the purpose of trading in a variety of securities and commodities, including off-exchange foreign currency contracts, through the use of false and misleading statements about, among other things, her historical trading performance. PARK was arrested on June 2, 2016, in Manhattan, New York, and pled guilty today before United States District Judge Ronnie Abrams.
U.S. Attorney Preet Bharara said: “Through her guilty plea today, Haena Park has admitted to commodities fraud, lying about her rates of return and trading expertise to lure prospective investors to her fund and then losing almost all of the $23 million she raised through her lies. To keep her fraud scheme alive, Park sent fake account statements to her investors and used new investor money to pay back old ones.”
According to the Indictment and statements made at today’s plea hearing:
From September 2009 through June 2016, PARK raised more than $23 million from more than 40 individual investors, purportedly for the purpose of trading in a variety of securities and commodities, including equities, futures, and off-exchange foreign currency (“forex”) transactions, through the use of her firms, Phaetra Capital Management LP and Argenta Group, LLC. In connection with the scheme, PARK made a series of false and misleading representations to investors, including that PARK was an accomplished forex trading adviser earning annualized returns as high as 48.9 percent for her investors. In truth and in fact, PARK was not an accomplished forex trader, her trading was consistently unsuccessful, and the trading results emailed to investors by PARK were false and did not reflect the trading losses actually incurred by PARK. Rather, from September 2009 through June 2016, PARK lost approximately $19.5 million of the $20 million that she traded, including in commissions and fees, principally in highly leveraged futures and forex transactions.
To prevent or forestall redemptions by investors, and to continue to raise money from investors to fund her scheme, PARK generated fictitious account statements, which she sent to investors on a monthly basis. Instead of accurately reporting the trading losses PARK was suffering, the account statements indicated that the investors were making money nearly every month. To hide her trading losses, PARK used new investor funds to pay back other investors in a Ponzi-like fashion. In total, PARK distributed approximately $3 million back to investors from funds deposited by new investors.
* * *
PARK, 41, of Manhattan, New York, faces a maximum sentence of 10 years in prison and a maximum fine of $1 million, or twice the gross gain or loss from the offense. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. PARK is scheduled to be sentenced by Judge Abrams on April 28, 2017, at 2:30 p.m.
Mr. Bharara praised the work of the Department of Homeland Security, Homeland Security Investigations and the El Dorado Task Force. He also thanked the Commodity Futures Trading Commission and the Securities and Exchange Commission for their assistance.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Christine I. Magdo is in charge of the prosecution.
Manhattan U.S. Attorney Files Civil Rights Suit and Enters Settlement with Real Estate Developer to Enhance Accessibility at Three Buildings with More Than 2,400 Rental ApartmentsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that the United States has settled a federal civil rights lawsuit against SILVERSTEIN PROPERTIES, INC. (“SILVERSTEIN PROPERTIES”) and two of its affiliates, River Place I, LLC and River Place II Holding, LLC, by consent decree. Under the settlement, SILVERSTEIN PROPERTIES has agreed to make retrofits at two large rental complexes in Manhattan – One River Place and Silver Towers – to make them more accessible to individuals with disabilities. SILVERSTEIN PROPERTIES also has agreed to inspect a third rental complex in Manhattan, One Freedom Place, and, where necessary, make retrofits at that building as well. Additionally, SILVERSTEIN PROPERTIES must establish procedures to ensure that its ongoing and future development projects will comply with the accessibility requirements of the federal Fair Housing Act (“FHA”). Finally, SILVERSTEIN PROPERTIES has agreed to provide up to $960,000 to compensate aggrieved persons and pay a civil penalty of $50,000. The consent decree was approved yesterday by U.S. District Judge Vernon Broderick.
Manhattan U.S. Attorney Preet Bharara said: “This lawsuit demonstrates our commitment to fulfilling for all New Yorkers the promise of the Fair Housing Act — that people with disabilities have the same access to housing as everyone else. Today’s settlement requires Silverstein Properties to adopt procedures to ensure accessibility at its current and future development projects, making retrofits at buildings that it has already developed, and compensating aggrieved parties.”
The FHA’s accessible design and construction provisions require new multifamily housing complexes constructed after January 1993 to have basic features accessible to persons with disabilities. According to the allegations in the Complaint, One River Place and Silver Towers, two rental complexes located in Manhattan that together contain more than 2,200 rental units, were designed and constructed with numerous inaccessible features, including excessively high thresholds interfering with accessible routes in the public and common areas as well as into and within individual units, insufficient spaces in bathrooms and kitchens for people in wheelchairs, and bathroom configurations preventing installation of grab bars. The inaccessible conditions at One River Place were first brought to the attention of the United States Attorney’s Office by testing performed by the Fair Housing Justice Center.
Under the settlement, SILVERSTEIN PROPERTIES agrees to make extensive retrofits at One River Place and Silver Towers to make them accessible. SILVERSTEIN PROPERTIES also agrees to arrange for inspection of a third rental complex in Manhattan, One Freedom Place, and, where necessary, to make retrofits at that property as well. Together, the three properties contain more than 2,400 rental apartments.
The settlement also requires SILVERSTEIN PROPERTIES to establish procedures to ensure FHA compliance at its ongoing and future development projects. These include retaining an FHA compliance consultant to ensure that each residential building developed by SILVERSTEIN PROPERTIES will, as constructed, comply with the FHA’s accessibility requirements. The FHA consultant also will conduct a site visit to identify non-compliant conditions and recommend appropriate solutions prior to the completion of construction. In addition, SILVERSTEIN PROPERTIES agrees to institute policies and training to ensure that its employees and agents will comply with the FHA’s accessibility requirements.
Finally, the settlement requires SILVERSTEIN PROPERTIES to provide up to $960,000 to compensate aggrieved persons. SILVERSTEIN PROPERTIES also agrees to pay a civil penalty of $50,000.
The government’s lawsuit also asserts claims against the architect of One River Place and Silver Towers, COSTAS KONDYLIS & PARTNERS, LLP. Those claims remain pending.
Aggrieved individuals may be entitled to monetary compensation from the fund created through today’s settlement. Aggrieved individuals may include those who were:
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Injured by a lack of accessible features at One River Place, Silver Towers, or One Freedom Place;
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Discouraged from living at One River Place, Silver Towers, or One Freedom Place because of the lack of accessible features;
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Required to pay to have an apartment at One River Place, Silver Towers, or One Freedom Place made accessible;
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Prevented from having visitors because of a lack of accessible features at One River Place, Silver Towers, or One Freedom Place; or
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Otherwise injured or discriminated against on the basis of disability due to the design or construction of One River Place, Silver Towers, or One Freedom Place.
People who may be entitled to compensation should file a claim by contacting the Civil Rights Complaint Line at (212) 637-0840, using the Civil Rights Complaint Form available on the United States Attorney’s Office’s website http://www.justice.gov/usao/nys/civilrights.html, or by sending a written claim to:
U.S. Attorney’s Office, Southern District of New York
86 Chambers Street, 3rd Floor
New York, New York 10007
Attention: Chief, Civil Rights Unit
The case is being handled by the Office’s Civil Rights Unit. Assistant U.S. Attorneys Li Yu, Jacob Lillywhite, Jessica Jean Hu, and Natasha W. Teleanu are in charge of the case.
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Lower Brule Man Sentenced for Assaulting a Federal OfficerRead the Press Release
United States Attorney Randolph J. Seiler announced that a Lower Brule, South Dakota, man charged with Assaulting, Resisting, and Impeding a Federal officer pled guilty to, and was sentenced, on January 4, 2017, by U.S. Magistrate Judge Mark A. Moreno.
Johnny Walking Bull, age 32, was sentenced to 10 months in custody, 12 months of supervised release, and $25 to the Federal Crime Victims Fund.
The conviction stems from an incident that took place on March 19, 2016, when an officer with the Bureau of Indian Affairs received a call regarding an assault that was reported to be taking place at a residence in Lower Brule. While in route, the officer was informed that Walking Bull had left their residence wearing a light blue jacket and blue jeans, and that he had gotten into a blue Dodge Durango heading towards Fort Thompson.
The officer went towards Fort Thompson and observed a blue Dodge Durango coming his way. As the car came closer, the officer observed two males in the car, one of whom was wearing a light blue jacket. He turned his patrol unit around, initiated a stop, made contact with the driver of the Durango and asked him if Walking Bull was with him, to which the driver responded that he was sitting in the passenger seat. The officer asked Walking Bull to step outside the vehicle so he could speak with him, to which Walking Bull used profane language, and refused to follow the officer’s requests. Walking Bull then exited the vehicle, removed his jacket, assumed a fighting stance towards the officer, and clenched his fists.
Walking Bull then lowered his head and started swinging his fists at the officer, missing him. The officer moved into close quarters and both of them ended up wrestling on the ground, with Walking Bull throwing punches at the officer and striking him on the cheek. While on the ground, Walking Bull continued to resist and tried multiple times to get up from the ground. Walking Bull was taken into custody and transported to jail.
The investigation was conducted by the Bureau of Indian Affairs, Lower Brule Agency. The case was prosecuted by Assistant U.S. Attorney Meghan N. Dilges.
Walking Bull is allowed to self-report on January 20, 2017.
Louisiana Man Pleads Guilty to Federal Charge for Threatening Pizza Shop in Northwest WashingtonRead the Press Release
SHREVEPORT, LA. – A Louisiana man pled has pled guilty to a federal charge following his arrest for calling a Washington, D.C., pizzeria and threatening to shoot people there, announced Channing D. Phillips, U.S. Attorney for the District of Columbia, and Stephanie A. Finley, U.S. Attorney for the Western District of Louisiana.
Yusif Lee Jones, 52, of Shreveport, pled guilty on Jan. 12, 2017, in the U.S. District Court for the Western District of Louisiana, to one count of interstate threatening communications. He is to be sentenced on April 12, 2017, by U.S. District Judge S. Maurice Hicks Jr. Jones, who has been in custody in Louisiana since his arrest there on Dec. 22, 2016, faces a statutory maximum of five years in prison, three years of supervised release, restitution and a $250,000 fine.
According to the government’s evidence, Jones made the threat by telephone on Dec. 7, 2016, three days after a shooting at the Comet Ping Pong pizza shop in Washington, D.C., which was reported on by the national news media. The gunman in that case, who faces federal charges in Washington, D.C., was motivated, at least in part, by unfounded rumors concerning a child sex-trafficking ring. No one was injured in the gunfire. According to the government’s evidence, Jones called the Besta Pizza shop in Washington, D.C., and said he was trying to “save the kids” and threatened to “shoot everyone in the place.”
An investigation by the Metropolitan Police Department (MPD) and the FBI’s Washington Field Office traced the call to Jones in Shreveport. Jones subsequently admitted to making the threatening call and was arrested. He initially was charged in the Superior Court of the District of Columbia, but that case is to be dismissed in light of the federal prosecution in Louisiana.
The investigation was conducted by the Metropolitan Police Department (MPD) and the FBI’s Washington Field Office. Those working on the case from the U.S. Attorney’s Office for the District of Columbia included Assistant U.S. Attorneys T. Patrick Martin, John Giovannelli, Demian S. Ahn, and Sonali D. Patel, as well as Victim/Witness Advocates Yvonne Bryant and Karina Hernandez. Assistant U.S. Attorney William J. Flanagan of the U.S. Attorney’s Office for the Western District of Louisiana is prosecuting the case.
Little Eagle Man Sentenced for Failure to Register as a Sex OffenderRead the Press Release
United States Attorney Randolph J. Seiler announced that a Little Eagle, South Dakota, man convicted of Failure to Register as a Sex Offender was sentenced on January 4, 2017, by U.S. District Judge Charles B. Kornmann.
Kimo Little Bird, age 35, was sentenced to 27 months in custody, 5 years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Little Bird was indicted by a federal grand jury on September 13, 2016. He pled guilty on October 31, 2016.
The conviction stems from Little Bird failing to register as a sex offender as required by federal law between June 16, 2016, and September 13, 2016. Little Bird had previously been convicted of a sex offense in federal court, which requires him to register as a sex offender for 25 years starting in 2006.
This case was investigated by the U.S. Marshals Service. Assistant U.S. Attorney Troy R. Morley prosecuted the case.
Little Bird was immediately turned over to the custody of the U.S. Marshals Service.
Lincoln Woman Sentenced for Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney, Deborah R. Gilg, announced that on January 13, 2017, Angela Tierney, 34, of Lincoln, was sentenced to five years and three months (63 months) for her role in a conspiracy to distribute and possess with the intent to distribute 500 grams or more of a substance containing methamphetamine between January of 2013, and February of 2015. Information obtained by law enforcement indicated that Tierney was responsible for the distribution of at least 500 grams, (approximately 18 ounces) of methamphetamine during that time.
This case was investigated by the Lincoln/Lancaster County Drug Task Force.
Lexington Man Faces Life in Prison After Convicted by Jury of Distributing Fentanyl Resulting in DeathRead the Press Release
LEXINGTON, Ky. – A Lexington man faces life in prison after a jury convicted him of distributing fentanyl that resulted in the overdose death of a 37 year-old Fayette County resident.
On Thursday, Joshua Donald Ewing, 28, was convicted of distribution of a controlled substance resulting in death. The jury returned the verdict after seven hours of deliberation following two days of trial. Because of Ewing’s criminal history, he is subject to a mandatory life sentence under the federal overdose death law. Sentencing is scheduled for February 6.
“The drug dealers who sell heroin and fentanyl in our communities know full well that, sooner or later, the result of their criminal conduct is likely a tragic and unnecessary death,” said Kerry B. Harvey, United States Attorney for the Eastern District of Kentucky. “Overdose victims are not merely statistics-they leave behind grieving parents, siblings, and children who deserve justice. While we take no joy in these cases, we are committed to using every available tool to combat the opioid epidemic which so afflicts our Commonwealth. All of us owe a debt of gratitude to the local and federal law enforcement officers who do the hard work that has made our Overdose Prosecution Initiative so successful.”
According to evidence presented at trial, in February of 2016, Ewing sold fentanyl to Jeremy Deaton, who was expecting heroin. Deaton consumed the drug, and died of an overdose. A toxicologist testified that, had it not been for the fentanyl, Deaton would not have died. The toxicologist further testified that Deaton had more than five times the therapeutic range of fentanyl in his blood.
Ewing was on probation for possession of heroin at the time he sold the fentanyl to Deaton.
U.S. Attorney Harvey; Timothy J. Plancon, Special Agent in Charge of the Detroit Field Division of the Drug Enforcement Administration; and Mark Barnard, Chief of Lexington Police, jointly made the announcement.
The investigation was conducted by the Lexington Police and the DEA. Assistant U.S. Attorney Todd Bradbury prosecuted this case on behalf of the federal government
Lauderdale County Man Pleads Guilty to Felon in Possession of a FirearmRead the Press Release
Jackson, Miss – Marvin Naylor, 46, from Daleville, Mississippi, pleaded guilty on January 9, 2017, before U.S. District Judge Henry T. Wingate, to possession of a firearm by a convicted felon, announced U.S. Attorney Gregory K. Davis.
Marvin Naylor admitted to possessing three firearms on November 10, 2015 in Daleville, at a time in which he was already a convicted felon. Agents with the Bureau of Alcohol, Tobacco, Firearms, and Explosives along with the Mississippi Bureau of Narcotics and the Lauderdale County Sheriff’s Department executed an arrest and search warrant on Naylor’s home. During this search and arrest, law enforcement officers were able to locate three firearms, two of which were stolen, along with several rounds of ammunition. Naylor was arrested and admitted to possessing the firearms. He will be sentenced on March 20, 2017 and faces a maximum penalty of 10 years in prison and a $250,000 fine.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives along with the Mississippi Bureau of Narcotics and the Lauderdale County Sheriff’s Department. It is being prosecuted by Assistant U.S. Attorney Abe McGlothin, Jr.
Kenel Man Sentenced for Conspiracy to Distribute a Controlled SubstanceRead the Press Release
United States Attorney Randolph J. Seiler announced that a Kenel, South Dakota, man charged with Conspiracy to Distribute a Controlled Substance was sentenced on January 4, 2017, by U.S. District Judge Charles B. Kornmann.
Kass Gayton, age 32, was sentenced to 3 years of probation, a $1,000 fine, and $100 to the Federal Crime Victims Fund.
Gayton was indicted by a federal grand jury on December 8, 2015. He pled guilty on October 31, 2016.
The conviction stems from an incident that took place on July 22, 2015, when the Bureau of Indian Affairs law enforcement, acting on a tip from Prairie Knights Casino security, began an investigation into four individuals who were reported to have been selling methamphetamine. Security directed law enforcement’s attention to two vehicles the individuals had been using. A drug dog was used around the outside of the vehicles and “indicated” on both vehicles. Law enforcement applied for, and obtained, federal search warrants for the two vehicles and found methamphetamine.
Gayton had been selling small amounts of methamphetamine on the Standing Rock Reservation.
The investigation was conducted by the Bureau of Indian Affairs, Standing Rock Agency. The case was prosecuted by Assistant U.S. Attorney Troy R. Morley.
Justice Department and State Partners Secure Nearly $864 Million Settlement with Moody’s Arising from Conduct in the Lead up to the Financial CrisisRead the Press Release
The Department of Justice, 21 states, and the District of Columbia reached a nearly $864 million settlement agreement with Moody’s Investors Service Inc., Moody’s Analytics Inc., and their parent, Moody’s Corporation, the Department announced today. The settlement resolves allegations arising from Moody’s role in providing credit ratings for Residential Mortgage-Backed Securities (RMBS) and Collateralized Debt Obligations (CDO), contributing to the worst financial crisis since the Great Depression.
The agreement resolves pending state court lawsuits in Connecticut, Mississippi, and South Carolina, as well as potential claims by the Justice Department, 18 states and the District of Columbia.
The settlement follows an investigation by the Justice Department’s Consumer Protection Branch and the U.S. Attorney’s Office for the District of New Jersey into potential claims pursuant to the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) and investigations conducted by various State Attorneys General pursuant to state law.
"Moody’s failed to adhere to its own credit rating standards and fell short on its pledge of transparency in the run-up to the Great Recession," said Principal Deputy Associate Attorney General Bill Baer. "Today’s settlement contains not only a significant penalty and factual admissions of its conduct, but also a commitment by Moody’s to new and continued compliance measures designed to ensure the integrity of credit ratings going forward."
"Our investigation revealed, and Moody’s has now acknowledged, that Moody’s used a more lenient standard than it had itself published," said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. "Investors relied on Moody’s credit ratings to be objective and independent, and they naturally expected Moody’s to follow its own published methods."
"Moody’s touted a particularly robust analytical framework for rating RMBS and CDOs," said U.S. Attorney Paul J. Fishman for the District of New Jersey. "Moody’s now admits that it deviated from its methodologies and failed to disclose those changes to the public. People making decisions on how to invest their money thought they could rely on the ratings Moody’s assigned to these products. When securities are not rated openly and honestly, individual investors suffer, as does confidence in all parts of the financial sector."
The multi-faceted settlement includes a Statement of Facts in which Moody’s acknowledges key aspects of its conduct, and a compliance agreement to prevent future violations of law. The Statement of Facts addresses Moody’s representations to investors and the public generally about: (1) its objectivity and independence; (2) its management of conflicts of interest; (3) its compliance with its own stated RMBS and CDO rating methodologies and standards; and (4) the analytic integrity of certain rating methodologies.
The Statement of Facts addresses whether Moody’s credit ratings were compromised by what Moody’s itself acknowledged were the conflicts of interest inherent in the so-called "issuer pay" model, under which Moody’s and other credit rating agencies are selected by the same entity that puts together and markets the rated securities and therefore stands to benefit from higher credit ratings.
Among other things, Moody’s acknowledges in the Statement of Facts:
- Moody’s published and maintained online its "Code of Professional Conduct" for the stated purpose of promoting the "integrity, objectivity, and transparency of the credit ratings process," including managing conflicts of interest that it publicly acknowledged arose from the fact that RMBS and CDO issuers determined whether to retain Moody’s to rate these securities.
- Moody’s acknowledges that it passed these conflicts on to the managing directors of the business units, who were then asked to resolve the "dilemma" between maintaining ratings quality and the need to win business from the issuers that selected them.
- Moody’s publicly stated that its ratings "primarily address the expected credit loss an investor might incur," which included its assessment of both the "probability of default" and the "loss given default" of rated securities.
- Starting in 2001, Moody’s RMBS group began using an internal tool in rating RMBS that did not calculate the loss given default or expected loss for RMBS below Aaa and did not incorporate Moody’s own rating standards. Instead, the tool was designed to "replicate" ratings that had been assigned based on a previous model that calculated expected loss for each tranche and incorporated Moody’s rating level standards. In October 2007, a senior manager in Moody’s Asset Finance Group (AFG) noted the following about Moody’s RMBS ratings derived from the tool: "I think this is the biggest issue TODAY. [A Moody’s AFG Senior Vice President and research manager]’s initial pass shows that our ratings are 4 notches off."
- Starting in 2004, Moody’s did not follow its published idealized expected loss standards in rating certain Aaa CDO securities. Instead, Moody’s began using a more lenient standard for rating these Aaa securities but did not issue a publication about this practice to the general market.
- In 2005, Moody’s authorized the expanded use of this practice to all Aaa CDO securities and, in 2006, formally authorized the use of this practice, or of an even more lenient standard, to all Aaa structured finance securities. Throughout this period, although "[m]any arrangers and issuers were aware" that Moody’s was using a more lenient Aaa standard, Moody’s did not issue publications about these decisions to the general market.
The Statement of Facts further addresses other important aspects of Moody’s rating methodologies, including its "inconsistent use of present value discounts" in assigning CDO ratings and its selection of assumptions about the correlations between assets in CDOs.
Under the terms of the compliance commitments, Moody’s agrees to maintain a host of measures designed to ensure the integrity of its credit ratings. These include:
- Separation of Moody’s commercial and credit rating functions by excluding analytical personnel from any commercial related discussions and excluding personnel responsible for commercial functions from determining credit ratings or developing rating methodologies;
- Independent review and approval of changes to rating methodologies by maintaining separate groups to develop and review rating methodologies;
- Changes to ensure that specified personnel are not compensated on the basis of the company’s financial performance;
- Enhancing Moody’s oversight functions to monitor the content of press releases and the timeliness of methodology development;
- Deploying new technological platforms and centralized systems for documentation of rating procedures; and
- Certifications of compliance by the President/CEO of Moody’s with these commitments for at least five years.
"The Department of Justice is committed to working with companies that are willing to admit what they did and take steps to enhance compliance," said Deputy Assistant Attorney General Jonathan Olin for the Department’s Consumer Protection Branch. "Non-monetary measures such as those agreed to today are part of the Department’s comprehensive approach to protect the American people by promoting a culture of compliance across industries."
The settlement includes a $437.5 million federal civil penalty, which is the second largest payment of this type ever made to the federal government by a ratings agency. The remainder will be distributed among the settlement member states in alignment with terms of the agreement. The states involved in today’s settlement include Arizona, California, Connecticut, Delaware, Idaho, Illinois, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Mississippi, Missouri, New Hampshire, New Jersey, North Carolina, Oregon, Pennsylvania, South Carolina and Washington as well as the District of Columbia.
The matter was handled by Consumer Protection Branch Senior Litigation Counsel Sondra L. Mills, and Trial Attorney James T. Nelson; and by the U.S. Attorney’s Office District of New Jersey Deputy Chief, Civil Division Leticia Vandehaar and Assistant U.S. Attorneys Thomas G. Strong and Alex S. Weinberg.
For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the District of New Jersey, visit its website at http://www.justice.gov/usao-nj.
Justice Department and State Partners Secure $864 Million Settlement with Moody’s Arising from Conduct in the Lead up to the Financial CrisisRead the Press Release
NEWARK, N.J. – The U.S. Department of Justice, 21 other states, and the District of Columbia reached a $864 million settlement agreement with Moody’s Investors Service Inc., Moody’s Analytics Inc. and their parent, Moody’s Corporation, the Department announced today. The settlement resolves allegations arising from Moody’s role in providing credit ratings for Residential Mortgage-Backed Securities (RMBS) and Collateralized Debt Obligations (CDO), contributing to the worst financial crisis since the Great Depression.
The agreement resolves pending state court lawsuits in Connecticut, Mississippi, and South Carolina, as well as potential claims by the Justice Department, 18 states and the District of Columbia.
The settlement follows an investigation by the U.S. Attorney’s Office for the District of New Jersey and the Justice Department’s Consumer Protection Branch into potential claims pursuant to the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) and investigations conducted by various State Attorneys General pursuant to state law.
“Moody’s touted a particularly robust analytical framework for rating RMBS and CDOs,” U.S. Attorney Fishman said. “Moody’s now admits that it deviated from its methodologies and failed to disclose those changes to the public. People making decisions on how to invest their money thought they could rely on the ratings Moody’s assigned to these products. When securities are not rated openly and honestly, individual investors suffer, as does confidence in all parts of the financial sector.”
“Moody’s failed to adhere to its own credit rating standards and fell short on its pledge of transparency in the run-up to the Great Recession,” said Principal Deputy Associate Attorney General Bill Baer. “Today’s settlement contains not only a significant penalty and factual admissions of its conduct, but also a commitment by Moody’s to new and continued compliance measures designed to ensure the integrity of credit ratings going forward.”
“Our investigation revealed, and Moody’s has now acknowledged, that Moody’s used a more lenient standard than it had itself published,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “Investors relied on Moody’s credit ratings to be objective and independent, and they naturally expected Moody’s to follow its own published methods.”
The multi-faceted settlement includes a Statement of Facts in which Moody’s acknowledges key aspects of its conduct, and a compliance agreement to prevent future violations of law. The Statement of Facts addresses Moody’s representations to investors and the public generally about: (1) its objectivity and independence; (2) its management of conflicts of interest; (3) its compliance with its own stated RMBS and CDO rating methodologies and standards; and (4) the analytic integrity of certain rating methodologies.
The Statement of Facts addresses whether Moody’s credit ratings were compromised by what Moody’s itself acknowledged were the conflicts of interest inherent in the so-called “issuer pay” model, under which Moody’s and other credit rating agencies are selected by the same entity that puts together and markets the rated securities and therefore stands to benefit from higher credit ratings.
Among other things, Moody’s acknowledges in the Statement of Facts:
- Moody’s published and maintained online its “Code of Professional Conduct” for the stated purpose of promoting the “integrity, objectivity, and transparency of the credit ratings process,” including managing conflicts of interest that it publicly acknowledged arose from the fact that RMBS and CDO issuers determined whether to retain Moody’s to rate these securities.
- Moody’s acknowledges that it passed these conflicts on to the managing directors of the business units, who were then asked to resolve the “dilemma” between maintaining ratings quality and the need to win business from the issuers that selected them.
- Moody’s publicly stated that its ratings “primarily address the expected credit loss an investor might incur,” which included its assessment of both the “probability of default” and the “loss given default” of rated securities.
- Starting in 2001, Moody’s RMBS group began using an internal tool in rating RMBS that did not calculate the loss given default or expected loss for RMBS below Aaa and did not incorporate Moody’s own rating standards. Instead, the tool was designed to “replicate” ratings that had been assigned based on a previous model that calculated expected loss for each tranche and incorporated Moody’s rating level standards. In October 2007, a senior manager in Moody’s Asset Finance Group (AFG) noted the following about Moody’s RMBS ratings derived from the tool: “I think this is the biggest issue TODAY. [A Moody’s AFG Senior Vice President and research manager]’s initial pass shows that our ratings are 4 notches off.”
- Starting in 2004, Moody’s did not follow its published idealized expected loss standards in rating certain Aaa CDO securities. Instead, Moody’s began using a more lenient standard for rating these Aaa securities but did not issue a publication about this practice to the general market.
- In 2005, Moody’s authorized the expanded use of this practice to all Aaa CDO securities and, in 2006, formally authorized the use of this practice, or of an even more lenient standard, to all Aaa structured finance securities. Throughout this period, although “[m]any arrangers and issuers were aware” that Moody’s was using a more lenient Aaa standard, Moody’s did not issue publications about these decisions to the general market.
The Statement of Facts further addresses other important aspects of Moody’s rating methodologies, including its “inconsistent use of present value discounts” in assigning CDO ratings and its selection of assumptions about the correlations between assets in CDOs.
Under the terms of the compliance commitments, Moody’s agrees to maintain a host of measures designed to ensure the integrity of its credit ratings. These include:
- Separation of Moody’s commercial and credit rating functions by excluding analytical personnel from any commercial related discussions and excluding personnel responsible for commercial functions from determining credit ratings or developing rating methodologies;
- Independent review and approval of changes to rating methodologies by maintaining separate groups to develop and review rating methodologies;
- Changes to ensure that specified personnel are not compensated on the basis of the company’s financial performance;
- Enhancing Moody’s oversight functions to monitor the content of press releases and the timeliness of methodology development;
- Deploying new technological platforms and centralized systems for documentation of rating procedures; and
- Certifications of compliance by the President/CEO of Moody’s with these commitments for at least five years.
“The Department of Justice is committed to working with companies that are willing to admit what they did and take steps to enhance compliance,” said Deputy Assistant Attorney General Jonathan Olin for the Department’s Consumer Protection Branch. “Non-monetary measures such as those agreed to today are part of the Department’s comprehensive approach to protect the American people by promoting a culture of compliance across industries.”
The settlement includes a $437.5 million civil penalty, which is the second largest payment of this type ever made to the federal government by a ratings agency. The remainder will be distributed among the settlement member states in alignment with terms of the agreement. The states involved in today’s settlement include Arizona, California, Connecticut, Delaware, Idaho, Illinois, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Mississippi, Missouri, New Hampshire, New Jersey, North Carolina, Oregon, Pennsylvania, South Carolina and Washington as well as the District of Columbia.
The matter was handled by Consumer Protection Branch Director Michael S. Blume, Senior Litigation Counsel Sondra L. Mills, and Trial Attorney James T. Nelson; and by the U.S. Attorney’s Office District of New Jersey Deputy Chief, Civil Division Leticia Vandehaar and Assistant U.S. Attorneys Thomas G. Strong and Alex S. Weinberg.
For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the District of New Jersey, visit its website at http://www.justice.gov/usao-nj.
Justice Department and Federal Trade Commission Announce Updated International Antitrust GuidelinesRead the Press Release
The Department of Justice and the Federal Trade Commission (FTC) issued today revised Antitrust Guidelines for International Enforcement and Cooperation. These guidelines update the 1995 Antitrust Enforcement Guidelines for International Operations and provide guidance to businesses engaged in international activities on questions that concern the agencies’ international enforcement policy as well as the agencies’ related investigative tools and cooperation with foreign authorities.
The revised guidelines reflect the growing importance of antitrust enforcement in a globalized economy and the agencies’ commitment to cooperating with foreign authorities on both policy and investigative matters.
“Anticompetitive conduct that crosses borders can adversely affect our commerce with foreign nations. The department’s antitrust enforcement is focused on ending that conduct in order to protect consumers and businesses in the United States,” said Acting Assistant Attorney General Renata Hesse, in charge of the Department of Justice’s Antitrust Division. “The Antitrust Guidelines for International Enforcement and Cooperation released today provide important, up to date guidance to businesses engaged in international operations on our enforcement policies and priorities; the changes we have made to the international guidelines, last issued in 1995, reflect developments in the department’s practices and in the law over the last 22 years. Developed jointly with the FTC, the Guidelines are another powerful example of the benefits of collaboration between our Agencies.”
“The agencies’ enforcement of the U.S. antitrust laws now frequently involves activity outside the United States, increasingly requiring collaboration with international counterparts,” said Chairwoman Edith Ramirez of the FTC. “The Guidelines we are issuing today explain to the business and antitrust communities our current approaches to international enforcement policy and related investigative tools, and cooperation. They are the product of the excellent working relationship between our two agencies.”
The revisions describe the current practices and methods of analysis the agencies employ when determining whether to initiate and how to conduct investigations of, or enforcement actions against, conduct with an international dimension. The Antitrust Guidelines for International Enforcement and Cooperation are different from the 1995 guidelines in several important ways. In particular, they:
Add a chapter on international cooperation, which addresses the Agencies’ investigative tools, confidentiality safeguards, the legal basis for cooperation, types of information exchanged and waivers of confidentiality, remedies and special considerations in criminal investigations;
Update the discussion of the application of U.S. antitrust law to conduct involving foreign commerce, the Foreign Trade Antitrust Improvements Act, foreign sovereign immunity, foreign sovereign compulsion, the act of state doctrine and petitioning of sovereigns, in light of developments in both the law and the Agencies’ practice; and
Provide revised illustrative examples focused on the types of issues most commonly encountered.The agencies issued proposed revisions for public comment on Nov. 1, 2016, in response to which comments were received from practitioners, academics, economists, and other stakeholders. Public comments are available at https://www.justice.gov/atr/guidelines-and-policy-statements-0/antitrust-guidelines-international-enforcement-and-cooperation-2017.
The Antitrust Guidelines for International Enforcement and Cooperation are available on the Department’s website at https://www.justice.gov/atr/internationalguidelines/download and the FTC’s website at www.ftc.gov/InternationalGuidelines.
The FTC vote approving the 2017 Antitrust Guidelines for International Enforcement and Cooperation was 3-0.
Antitrust Guidelines for International Enforcement and Cooperation
Justice Department Sues KleinBank for Redlining Minority Neighborhoods in MinnesotaRead the Press Release
The Justice Department today filed a lawsuit against KleinBank alleging that the bank engaged in unlawful “redlining” of majority-minority neighborhoods in the Minneapolis-St. Paul metropolitan area. “Redlining” is the discriminatory practice by banks or other financial institutions of denying or avoiding providing credit services to consumers because of the racial or ethnic demographics of the neighborhood in which the consumer lives.
The lawsuit, filed in the U.S. District Court for the District of Minnesota, alleges that KleinBank violated the Fair Housing Act and Equal Credit Opportunity Act, which prohibit financial institutions from discriminating on the basis of race and color in their mortgage lending practices. The complaint alleges that from 2010 to at least 2015, KleinBank structured its residential mortgage lending business in such a way as to avoid serving the credit needs of neighborhoods where a majority of residents are racial and ethnic minorities.
The bank’s alleged redlining practices include: excluding majority-minority neighborhoods from the area it serves; locating branch offices and mortgage loan officers in majority-white neighborhoods, but not in majority-minority neighborhoods; and targeting marketing and advertising exclusively toward residents of majority-white neighborhoods. From 2010 to 2015, comparable lenders generated applications in majority-minority neighborhoods at over five times the rate of KleinBank and made loans in majority-minority neighborhoods at over four times the rate of KleinBank.
“Redlining produces an unequal and unlevel playing field for borrowers in minority neighborhoods,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “Cases like this one demonstrate the Justice Department’s strong commitment to hold banks accountable for continuing and perpetuating historic trends of inequality in residential mortgage lending.”
The Justice Department’s enforcement of fair lending laws is conducted by the Civil Rights Division’s Housing and Civil Enforcement Section. Since 2010, the division has provided over $1.6 billion in monetary relief for individual borrowers and impacted communities through its enforcement of the Fair Housing Act, ECOA and the Servicemembers Civil Relief Act. The Attorney General’s annual reports to Congress on ECOA enforcement highlight the department’s accomplishments in fair lending and are available at www.justice.gov/crt/publications/.
The Civil Rights Division is a member of the Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov.
Additional information about fair lending enforcement by the Justice Department can be found on the department’s website at www.justice.gov/fairhousing.
KleinBank Complaint KleinBank Exhibit A KleinBank Exhibit BJustice Department Awards $500,000 to Initiate Video-Based Services for Deaf VictimsRead the Press Release
Today the Justice Department’s Office on Violence Against Women (OVW) announced an award of $500,000 to the Vera Institute of Justice’s Center on Victimization and Safety to create a plan for establishing a National Deaf Service Line that will enable Deaf victims of domestic violence, sexual violence, dating violence and stalking to speak directly with a Deaf advocate or an individual who is fluent in their preferred mode of communication via video phone 24 hours per day, seven days per week.
For many Deaf individuals, the most effective form of communication is in-person, using sign language or an assistive communication device. Services that are most responsive to the needs of Deaf victims are firmly rooted in Deaf culture and provided by individuals who use the same mode of communication, but such services are often not available because of the limited number of culturally Deaf-specific domestic violence and sexual assault programs.
“Clear communication is essential to helping victims find and receive the services they need,” said OVW’s Principal Deputy Director Bea Hanson. “The National Deaf Service Line will give Deaf victims an enhanced means of accessing safe, culturally appropriate services.” While in-person services remain the best option, remote services, provided by a Deaf advocate, via video phone are the next best option.
The Vera Institute of Justice has worked extensively to end domestic and sexual violence in the lives of individuals with disabilities and Deaf individuals through trainings, technical assistance, conferences and a number of key Deaf-specific initiatives.
With this award, OVW is entering the first of a two-phase project; phase two will be the implementation of the plan the Vera Institute of Justice will developed. The plan will include description of how the National Deaf Service Line will complement the services currently offered to the Deaf community by the National Domestic Violence Hotline.
OVW provides leadership in developing the nation’s capacity to reduce violence against women through the implementation of the Violence Against Women Act (VAWA) and subsequent legislation. Created in 1995, OVW administers financial and technical assistance to communities across the country that are developing programs, policies and practices aimed at ending domestic violence, dating violence, sexual assault and stalking. In addition to overseeing 21 federal grant programs, OVW often undertakes initiatives in response to special needs identified by communities facing acute challenges. For more information on OVW, please visit www.justice.gov/ovw.
Justice Department Announces Findings of Investigation into Chicago Police DepartmentRead the Press Release
The Justice Department announced today that it has found reasonable cause to believe that the Chicago Police Department (CPD) engages in a pattern or practice of using force, including deadly force, in violation of the Fourth Amendment of the Constitution. The department found that CPD officers’ practices unnecessarily endanger themselves and result in unnecessary and avoidable uses of force. The pattern or practice results from systemic deficiencies in training and accountability, including the failure to train officers in de-escalation and the failure to conduct meaningful investigations of uses of force.
The city of Chicago and the Justice Department have signed an agreement in principle to work together, with community input, to create a federal court-enforceable consent decree addressing the deficiencies found during the investigation.
“One of my highest priorities as Attorney General has been to ensure that every American enjoys police protection that is lawful, responsive, and transparent,” said Attorney General Loretta E. Lynch. “Sadly, our thorough investigation into the Chicago Police Department found that far too many residents of this proud city have not received that kind of policing. The resulting deficit in trust and accountability is not just bad for residents – it’s also bad for dedicated police officers trying to do their jobs safely and effectively. With this announcement, we are laying the groundwork for the difficult but necessary work of building a stronger, safer, and more united Chicago for all who call it home.”
“The failures we identified in our findings – that we heard about from residents and officers alike — have deeply eroded community trust,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “But today is a moment of opportunity, where we begin to move from identifying problems to developing solutions. I know our findings can lead to reform and rebuild community-police trust because we’ve seen it happen in community after community around the country over the past 20 years.”
“The findings in our report, coupled with the City of Chicago and Police Department’s commitment to work together with us, are an historic turning point and a major step toward sustained change,” said U.S. Attorney Zachary T. Fardon of the Northern District of Illinois. “Implementing these findings is a necessary precursor to our long-term success in fighting violent crime in Chicago.”
On Dec. 7, 2015, Attorney General Lynch announced the investigation into the CPD and the city’s Independent Police Review Authority (IPRA). The investigation focused on CPD’s use of force, including racial, ethnic and other disparities in use of force, and its systems of accountability.
In the course of its pattern or practice investigation, the department interviewed and met with city leaders, current and former police officials, and numerous officers throughout all ranks of CPD. The department also accompanied line officers on over 60 ride-alongs in every police district; heard from over 1,000 community members and more than 90 community organizations; reviewed thousands of pages of police documents, including all relevant policies, procedures, training and materials; and analyzed a randomized, representative sample of force reports and the investigative files for incidents that occurred between January 2011 and April 2016, including over 170 officer-involved shooting investigations and documents related to over 400 additional force incidents.
The department found that CPD’s pattern or practice of unconstitutional force is largely attributable to deficiencies in its accountability systems and in how it investigates uses of force, responds to allegations of misconduct, trains and supervises officers, and collects and reports data on officer use of force. The department also found that the lack of effective community-oriented policing strategies and insufficient support for officer wellness and safety contributed to the pattern or practice of unconstitutional force.
In addition, the department also identified serious concerns about the prevalence of racially discriminatory conduct by some CPD officers and the degree to which that conduct is tolerated and in some respects caused by deficiencies in CPD’s systems of training, supervision and accountability. The department’s findings further note that the impact of CPD’s pattern or practice of unreasonable force falls heaviest on predominantly black and Latino neighborhoods, such that restoring police-community trust will require remedies addressing both discriminatory conduct and the disproportionality of illegal and unconstitutional patterns of force on minority communities.
In the agreement in principle, the Justice Department and the city of Chicago agreed that compliance with the consent decree will be reviewed by an independent monitor. The agreement in principle provides a general framework for change, but the department will be doing community outreach to solicit input in developing comprehensive reforms. In the days ahead, the department will continue speaking to local authorities, officers and ordinary citizens to gather their perspectives about the challenges facing the city – and the changes needed to address them. Comments from the public may be provided by email to [email protected].
Throughout the department’s investigation, CPD leadership remained receptive to preliminary feedback and technical assistance, and started the process of implementing reforms. Under the leadership of Mayor Rahm Emanuel and Superintendent Eddie Johnson, CPD has taken a number of encouraging steps, including creating the Civilian Office of Police Accountability to replace IPRA; issuing a new transparency policy mandating the release of videos and other materials related to certain officer misconduct investigations; beginning a pilot program for body-worn cameras, to be expanded CPD-wide; and committing to establish an anonymous hotline for employees to report misconduct. While these and other measures are an important start to cooperative reform, a comprehensive, court-enforceable agreement is needed to remedy all of the department’s findings and ensure lasting reform.
In addition, the department has been working with the city of Chicago as part of the Violence Reduction Network, a data-driven, evidence-based initiative that delivers strategic, intensive training and technical assistance. This assistance focuses on developing an overall violence reduction strategic framework; providing immediate technical assistance and expertise to CPD; analyzing high-crime neighborhoods for resource, social service and opportunity gaps; and assisting in building capacity in Chicago’s public safety offices. And in 2016, the U.S. Attorney’s Office for the Northern District of Illinois charged more illegal firearms cases in total, and more as a percentage of its overall cases, than it has in any year since 2004.
This investigation was conducted by the Civil Rights Division’s Special Litigation Section and the U.S. Attorney’s Office for the Northern District of Illinois with the assistance of law enforcement professionals, pursuant to the pattern-or-practice provision of the Violent Crime Control and Law Enforcement Act of 1994. Since 2009, the Special Litigation Section has opened 25 investigations into law enforcement agencies. The section is enforcing 20 agreements with law enforcement agencies, including 15 consent decrees and one post-judgment order. The division recently released a comprehensive report that provides an overview of the police reform work done pursuant to the Violent Crime Control and Law Enforcement Act of 1994, which can be found at the following link: /media/872116/dl?inline.
For more information on the Civil Rights Division and the Special Litigation Section, please visit www.justice.gov/crt.
Chicago Police Department Findings Chicago Agreement in Principle Chicago Police Department Findings Fact Sheet Pattern or Practice Accomplishments DocumentJustice Department Announces Findings of Investigation into Chicago Police DepartmentRead the Press Release
Justice Department Finds a Pattern of Civil Rights Violations by the Chicago Police Department
WASHINGTON – The Justice Department announced today that it has found reasonable cause to believe that the Chicago Police Department (CPD) engages in a pattern or practice of using force, including deadly force, in violation of the Fourth Amendment of the Constitution. The department found that CPD officers’ practices unnecessarily endanger themselves and result in unnecessary and avoidable uses of force. The pattern or practice results from systemic deficiencies in training and accountability, including the failure to train officers in de-escalation and the failure to conduct meaningful investigations of uses of force.
The city of Chicago and the Justice Department have signed an agreement in principle to work together, with community input, to create a federal court-enforceable consent decree addressing the deficiencies found during the investigation.
“One of my highest priorities as Attorney General has been to ensure that every American enjoys police protection that is lawful, responsive, and transparent,” said Attorney General Loretta E. Lynch. “Sadly, our thorough investigation into the Chicago Police Department found that far too many residents of this proud city have not received that kind of policing. The resulting deficit in trust and accountability is not just bad for residents – it’s also bad for dedicated police officers trying to do their jobs safely and effectively. With this announcement, we are laying the groundwork for the difficult but necessary work of building a stronger, safer, and more united Chicago for all who call it home.”
“The failures we identified in our findings – that we heard about from residents and officers alike — have deeply eroded community trust,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “But today is a moment of opportunity, where we begin to move from identifying problems to developing solutions. I know our findings can lead to reform and rebuild community-police trust because we’ve seen it happen in community after community around the country over the past 20 years.”
“The findings in our report, coupled with the City of Chicago and Police Department’s commitment to work together with us, are an historic turning point and a major step toward sustained change,” said U.S. Attorney Zachary T. Fardon of the Northern District of Illinois. “Implementing these findings is a necessary precursor to our long-term success in fighting violent crime in Chicago.”
On Dec. 7, 2015, Attorney General Lynch announced the investigation into the CPD and the city’s Independent Police Review Authority (IPRA). The investigation focused on CPD’s use of force, including racial, ethnic and other disparities in use of force, and its systems of accountability.
In the course of its pattern or practice investigation, the department interviewed and met with city leaders, current and former police officials, and numerous officers throughout all ranks of CPD. The department also accompanied line officers on over 60 ride-alongs in every police district; heard from over 1,000 community members and more than 90 community organizations; reviewed thousands of pages of police documents, including all relevant policies, procedures, training and materials; and analyzed a randomized, representative sample of force reports and the investigative files for incidents that occurred between January 2011 and April 2016, including over 170 officer-involved shooting investigations and documents related to over 400 additional force incidents.
The department found that CPD’s pattern or practice of unconstitutional force is largely attributable to deficiencies in its accountability systems and in how it investigates uses of force, responds to allegations of misconduct, trains and supervises officers, and collects and reports data on officer use of force. The department also found that the lack of effective community-oriented policing strategies and insufficient support for officer wellness and safety contributed to the pattern or practice of unconstitutional force.
In addition, the department also identified serious concerns about the prevalence of racially discriminatory conduct by some CPD officers and the degree to which that conduct is tolerated and in some respects caused by deficiencies in CPD’s systems of training, supervision and accountability. The department’s findings further note that the impact of CPD’s pattern or practice of unreasonable force falls heaviest on predominantly black and Latino neighborhoods, such that restoring police-community trust will require remedies addressing both discriminatory conduct and the disproportionality of illegal and unconstitutional patterns of force on minority communities.
- the agreement in principle, the Justice Department and the city of Chicago agreed that compliance with the consent decree will be reviewed by an independent monitor. The agreement in principle provides a general framework for change, but the department will be doing community outreach to solicit input in developing comprehensive reforms. In the days ahead, the department will continue speaking to local authorities, officers and ordinary citizens to gather their perspectives about the challenges facing the city – and the changes needed to address them. Comments from the public may be provided by email to [email protected].
Throughout the department’s investigation, CPD leadership remained receptive to preliminary feedback and technical assistance, and started the process of implementing reforms. Under the leadership of Mayor Rahm Emanuel and Superintendent Eddie Johnson, CPD has taken a number of encouraging steps, including creating the Civilian Office of Police Accountability to replace IPRA; issuing a new transparency policy mandating the release of videos and other materials related to certain officer misconduct investigations; beginning a pilot program for body-worn cameras, to be expanded CPD-wide; and committing to establish an anonymous hotline for employees to report misconduct. While these and other measures are an important start to cooperative reform, a comprehensive, court-enforceable agreement is needed to remedy all of the department’s findings and ensure lasting reform.
In addition, the department has been working with the city of Chicago as part of the Violence Reduction Network, a data-driven, evidence-based initiative that delivers strategic, intensive training and technical assistance. This assistance focuses on developing an overall violence reduction strategic framework; providing immediate technical assistance and expertise to CPD; analyzing high-crime neighborhoods for resource, social service and opportunity gaps; and assisting in building capacity in Chicago’s public safety offices. And in 2016, the U.S. Attorney’s Office for the Northern District of Illinois charged more illegal firearms cases in total, and more as a percentage of its overall cases, than it has in any year since 2004.
This investigation was conducted by the Civil Rights Division’s Special Litigation Section and the U.S. Attorney’s Office for the Northern District of Illinois with the assistance of law enforcement professionals, pursuant to the pattern-or-practice provision of the Violent Crime Control and Law Enforcement Act of 1994. Since 2009, the Special Litigation Section has opened 25 investigations into law enforcement agencies. The section is enforcing 20 agreements with law enforcement agencies, including 15 consent decrees and one post-judgment order. The division recently released a comprehensive report that provides an overview of the police reform work done pursuant to the Violent Crime Control and Law Enforcement Act of 1994, which can be found at the following link: https://www.justice.gov/crt/file/922421/download.
For more information on the Civil Rights Division and the Special Litigation Section, please visit www.justice.gov/crt.
Chicago Agreement in Principle Chicago Police Department Findings CPD Findings Factsheet SPL Police AccomplishmentsJackson County Couple Sentenced to Prison in Prescription Drug and Bankruptcy Fraud CaseRead the Press Release
Gulfport, Miss. – A Jackson County couple was sentenced by U.S. District Judge Sul Ozerden in a prescription fraud and embezzlement case, announced U. S. Attorney Gregory K. Davis, Acting U. S. Trustee Henry G. Hobbs, Jr. of Region 5, FBI Special Agent in Charge Christopher Freeze, and DEA Special Agent in Charge Stephen G. Azzam.
Sherrie Bennett, 57, of Vancleave, Mississippi, was sentenced on January 12, 2017, to serve 78 months in prison followed by three years supervised release and ordered to pay an $8,000 fine. She was convicted by a jury on July 29, 2016, after a two-week federal criminal trial, of fourteen counts of distributing prescription drugs and bankruptcy fraud.
Bennett, an officer manager and registered nurse with Biloxi Radiation and Oncology Center, LLC, a debtor in Chapter 11 bankruptcy in the Southern District of Mississippi, participated in fraudulent writing and issuance of drug prescriptions, as well as embezzlement of approximately $54,636 from the bankruptcy estate. Bennett embezzled and appropriated to her own use estate funds belonging to the debtor. At sentencing the Court ordered that Sherri Bennett pay restitution in the amount of $54,636.00 through the U. S. Trustee to the consolidated bankruptcy estate. Sherri Bennett was also convicted of dispensing prescriptions to herself and family members illegally.
Bennett’s husband, Jerry Bennett, 59, of Vancleave, Mississippi, was also sentenced on January 12, 2017, to serve 27 months in prison followed by three years supervised release for his part in distributing the narcotics. He was ordered to pay a $5,000 fine.
The Jackson, Mississippi Office of the U. S. Trustee and the Chapter 7 trustee, Kimberly Lentz, of Gulfport, Mississippi, referred the bankruptcy matter to the U. S. Attorney for prosecution. The Federal Bureau of Investigation, Drug Enforcement Administration, Mississippi Bureau of Narcotics, Mississippi Board of Pharmacy, and the U.S. Trustee assisted in the investigation. The case was prosecuted by Deputy Criminal Chief John Meynardie and Assistant U.S. Attorney Andrea Jones.
Itasca County Christmas Tree Thief Pleads GuiltyRead the Press Release
United States Attorney Andrew M. Luger today announced the guilty plea of JOSEPH LEON EDMINSTER, 70, for stealing thousands of black spruce tree tops from the Chippewa National Forest. EDMINSTER pleaded guilty to one count of theft of government property today before U.S. District Judge Wilhelmina M. Wright in St. Paul, Minn.
According to the defendant’s guilty plea and documents filed in court, between October 2008 and October 2014, JOSEPH EDMINSTER cut and stole more than 2,700 black spruce tree tops from the Chippewa National Forest. EDMINSTER did not have the authority to take the tree tops from federal lands.
After taking the tree tops, EDMINSTER would sell them to wholesalers for use as Christmas decorations. EDMINSTER sold the tops for $1.50 to $2.50 each to various wholesale vendors, who in turn would sell each top for up to $6 each to various retail outlets in Minnesota, Iowa and Illinois. The retail cost for individual spruce tops ranges from $2.50 to $7.50 depending on the height. Spruce tops are most often sold in bundles of five or 10 depending on the height with each bundle retailing from $12.99 to $36.99. Since 2008, EDMINSTER stole at least $24,199.50 worth of spruce tops from federal land.
“We will vigorously pursue those responsible for such acts, dedicating any and all investigative resources needed in order to bring these matters to a just conclusion,” said Darla Lenz, the Chippewa National Forest supervisor. “The public can rest assured that this matter has been resolved and we will continue to protect our national forests.”
Black spruce is a North American pine species. It is widespread across Canada and the northern United States, including the Great Lakes region. Black Spruce is found in northern and northeastern parts of Minnesota, extending as far south as northern Anoka County.
The popularity of black spruce tops and other forest products that are used in the seasonal holiday decorative market has surged over the last 20 years. The spruce tops are sold at landscape retailers and some grocery and home improvement stores nationwide.
The cutting or otherwise damaging any timber, tree or other forest product, to include black spruce is prohibited on National Forest land except as authorized by a special use authorization, timber sale, contract or other federal law or regulation.
This case is the result of an investigation conducted by the U.S. Forest Service’s Law Enforcement and Investigations division.
This case is being prosecuted by Assistant United States Attorney Laura Provinzino.
Defendant Information:JOSEPH LEON EDMINSTER, 70
Grand Rapids, Minn.Convicted:
• Theft of government property, 1 countIraqi National Pleads Guilty to Immigration ChargeRead the Press Release
Charlottesville, VIRGINIA – A Harrisonburg man, who attempted to bring an alien into the United States whom he allegedly knew was prohibited from entering the country, pled guilty and was sentenced today in the United States District Court for the Western District of Virginia in Charlottesville, Acting United States Attorney Rick A. Mountcastle announced.
Ahmed Thamer Al-Ani, 51, an Iraqi-born national living in Harrisonburg, pled guilty today to one count of encouraging or inducing an illegal alien to come to the United States. In a subsequent hearing today in U.S. District Court, Al-Ani was sentenced to six months’ imprisonment. The defendant will be deported as part of his sentence.
According to evidence presented today by Assistant United States Attorney Christopher Kavanaugh in U.S. District Court, in early 2016, the defendant engaged in a scheme in which he sought to bring an alien named Firas Saeed from Iraq to the United States. Specifically, the defendant gave Saeed a false business invitation letter that he could give to the United States Embassy in Baghdad. The letter was a ruse to create the false impression that Saeed was a businessman – who had business with the defendant – so that his visa application would be approved and he would be admitted to the United States.
Ultimately, the scheme failed. On January 21, 2016, Saeed presented the defendant’s fictitious letter to the United States Embassy in Baghdad, but the consulate officer denied Saeed’s application for a visa to travel to the United States.
In May 2016, a Federal Bureau of Investigation undercover employee began communicating with Al-Ani by telephone. The undercover told the defendant that he had an individual in Baghdad, Iraq, who was in “some kind of trouble. They are looking for him and I want to get him out of Iraq and get him here.” The defendant asked whether “there [wa]s an arrest warrant issued against him currently, okay, and his name has been flagged, right?” The undercover confirmed that as accurate. In reality, no such alien existed and the undercover was participating in a planned sting operation with the Federal Bureau of Investigation.
In a series of conversations with the undercover, the defendant offered to create false documents – to include identification, a passport and other documents – for the price of $10,000, as well as a false business invitation letter for the price of $5,000. The undercover declined the offer for false documents but accepted the chance to have a business invitation letter provided for $5,000 and provided Al-Ani with an email address for the letter to be sent.
On the morning of June 3, 2016, Al-Ani emailed the defendant’s letter – similar to the one he had provided Saeed – to the email address provided. It was addressed to the United States Embassy in Baghdad and it named the fictitious person in Iraq (who did not exist) as a “potential partner” in Al-Ani’s business. That afternoon, Al-Ani met with the undercover FBI employee at the Courtyard Marriot hotel in Charlottesville, Virginia. During the meeting, Al-Ani took payment in the amount of $5,000 cash for providing the false business invitation letter. He was then arrested at the scene by agents with the FBI.
The investigation of the case was conducted by the Federal Bureau of Investigation and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Assistant United States Attorney Christopher Kavanaugh prosecuted the case for the United States.