Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
Thursday 12 January 2017
U.S. Attorney Joyce White Vance to Receive 2017 Lou Wooster Public Health Hero AwardRead the Press Release
The University of Alabama at Birmingham School of Public Health is honoring U.S. Attorney Joyce White Vance as the 2017 recipient of its Lou Wooster Public Health Hero award for her leadership in creating a broad-based response to the heroin epidemic in northern Alabama.
UAB School of Public Health announced today that its advisory board, the Broad Street Committee, has selected Vance for the award, which is presented annually to recognize an individual, group or organization that is an unconventional public health hero. The award is named in honor of Louise Wooster, the 19th century Birmingham madam who risked her life during the 1873 cholera epidemic by staying in the city to care for the sick and dying. A devastating cholera epidemic struck the young city that year and most residents, including all the local leadership, fled.
In its announcement, the UAB School of Public Health said Vance was selected for her leadership in comprehensively addressing the heroin epidemic in metropolitan Birmingham and elsewhere across the state. “When few recognized the emerging epidemic of heroin and opioid-related deaths, Joyce Vance, in her role as United States Attorney, convened the first ‘Pills to Needles Summit’ in June 2014 that overnight galvanized community leaders around this new public health threat. Through her leadership and determination, Joyce Vance established a new paradigm to address this threat to the public’s health that linked law enforcement, government, academia, public health, victims, and advocates. Together these institutions, organizations, and individuals have worked a long-term strategy that recognizes the complexities of this epidemic and is sufficiently flexible to adjust to anticipated but unknown changes in the substances, the populations, and the distributors,” the announcement said.
“Vance joins uncommon public health heroes, selected because their work falls outside the traditional boundaries of public health, yet has a great impact on the public’s health,” said Max Michael III, M.D., dean of the UAB School of Public Health.
Vance was one of the first five U.S. Attorneys nominated by President Barack Obama. The Senate confirmed her nomination Aug. 7, 2009. Vance served on the Attorney General’s Advisory Committee from 2009 to 2011, where she helped to craft Justice Department policy. She presently co-chairs the AGAC’s Criminal Practice Subcommittee, and serves on the Civil Rights Subcommittee.
Vance, like Lou Wooster, is an uncommon public health hero, the UAB announcement said. “Lou Wooster’s grit and determination to stay in Birmingham, along with some of the other girls at her house on Morris Avenue, is credited with assuring that there was a Birmingham for the leadership to come back to.”
Previous winners of the Lou Wooster Public Health Hero Award include State Representative Patricia Todd, the first openly gay elected official in the State of Alabama; American Electric Power, the Western Hemisphere’s largest burner of coal, for its strong and environmentally collaborative efforts to produce clean energy; the VF Corporation for its decision to rebuild the Wrangler Distribution Center in rural Hackleberg, Alabama, which was destroyed in the April 2013 tornados; and Angelou Ezeilo, Founder of the Greening Youth Foundation in Atlanta.
U.K. Insurance Broker Sentenced for Stealing $467K from ClientsRead the Press Release
ALEXANDRIA, Va. – Robert G. Ross, 51, of Middleburg, was sentenced today to 18 months in prison for stealing approximately $467,000 from his clients. Ross was also ordered to pay $467,000 in restitution and agreed to an asset forfeiture judgment.
Ross pleaded guilty on Sept. 29, 2016, to a criminal information charging him with one count of mail fraud. According to court documents, Ross, a citizen of the United Kingdom, owned and operated Thames Insurance Services, Inc., a wholesale marine insurance agency that served domestic retail insurance agents in the United States and brokers in London. Ross and Thames were intermediaries in the Lloyd’s of London insurance market. A portion of the Lloyd’s market involves excess and surplus insurance for high-risk conditions or policies that fall outside standard underwriting guidelines. Ross had a surplus insurance license that authorized him to place in the Lloyd’s market high-risk marine polices for ocean-bound yachts and other private and commercial vessels.
According to court documents, the domestic retail agents contacted Ross and requested that he locate brokers in London to place policies in the Lloyd’s market. The policyholders typically paid their retail agents the full premium amounts for the policies. The retail agents then forwarded the payments to Ross’ residence by U.S. mail and to his trust account by wire transfer. After deducting a commission, Ross was supposed to remit the net premium funds to two U.K. brokers. However, between February 2015 and November 2015, Ross abused his position of trust by not remitting payments from four retail agents. Ross instead converted the funds to personal use.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Joseph Cronin, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, made the announcement after sentencing by U.S. Senior District Judge James C. Cacheris. Special Assistant U.S. Attorney Edward P. Sullivan prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-218.
Two Sentenced in Conspiracy to Traffic Heroin Using MegabusRead the Press Release
U.S. Attorney Kenneth A. Polite announced that KEVIN GONZALES, age 25, of Houston, and EARL BROWN, age 32, of New Orleans, were sentenced today after having previously pled guilty to a conspiracy to distribute heroin.
U.S. District Judge Carl J. Barbier sentenced GONZALES to 57 months of incarceration, to be followed by 5 years of supervised release. BROWN was sentenced to 30 months of incarceration, to be followed by 3 years of supervised release.
Both defendants were charged in a 21-count Superseding Indictment on September 18, 2015. According to court documents, the Superseding Indictment resulted from an FBI investigation into a heroin-trafficking organization operating primarily around Loyola Avenue and Harmony Street in Central City. During the timeframe of this conspiracy, GONZALES traveled via Megabus from Houston to New Orleans, carrying half-kilogram quantities of heroin for distribution by BROWN and others in the New Orleans area.
U.S. Attorney Polite praised the work of the FBI New Orleans Gang Task Force (NOGTF), St. Tammany Parish Sheriff’s Office, the Jefferson Parish Sheriff’s Office, and the New Orleans Police Department in investigating this matter. Assistant United States Attorney Brandon S. Long is in charge of the prosecution.
Two Postal Carriers and Marijuana Organizations Charged with Bribery in Connection with Marijuana TraffickingRead the Press Release
Philadelphia - Acting United States Attorney Louis D. Lappen today announced three indictments[1] that collectively charged postal carriers Steven C. Williams, 42, and Felicia Charleston, 35, with using their positions as United States postal carriers to distribute large quantities of marijuana to conspiring with Chester Wynter, 49, Barrington Russell, 44, Damion Parkes, 44, Gillion Watson, 32, Marvia Shirley, 32, Patrick Purrier, 38, and Anthony Washington, 27.
In each of the three indictments, Williams was charged with conspiring with members of marijuana organizations to commit bribery, bribery of a public official, and conspiring with the members of the marijuana organizations to distribute at least 100 kilograms of marijuana. According to the indictments, Williams was a postal carrier at the West Market Post Office in Philadelphia and was responsible for delivering United States Postal Services’ packages to addresses in West Philadelphia, which included 48 N. Hobart Street and other addresses in West Philadelphia. Williams allegedly used his position as a postal carrier to divert packages from the addressee to Wynter, Russell, Parkes, Purrier and Washington for the purposes of distributing the marijuana contained within the packages, in return for cash. In two of the three indictments, Charleston was similarly charged with conspiring with members of marijuana organizations to distribute at least 100 kilograms of marijuana. According to these indictments, Charleston also worked at the West Market Post Office in Philadelphia and was responsible for delivering United States Postal Services’ packages to addresses in West Philadelphia, but she left her postal route to divert packages from the addressee to Wynter, Russell, and Washington for the purposes of distributing the marijuana contained within the packages.
According to the indictments, once the packages were delivered to Wynter, Russell, Parkes, Watson, and Shirley at 48 N. Hobart Street, and to Purrier and Washington at various locations in West Philadelphia, these marijuana conspiracy members distributed the marijuana to their customers.
Based on the quantity of the marijuana involved, the defendants face the following sentences:
Williams – a statutory maximum sentence of life imprisonment, a mandatory minimum sentence of ten years’ imprisonment, and a $28,500,000 fine
Charleston – a statutory maximum sentence of life imprisonment, a mandatory minimum sentence of ten years’ imprisonment, and a $20,250,000 fine
Wynter and Russell – a statutory maximum sentence of life imprisonment, a mandatory minimum sentence of ten years’ imprisonment, and a $10,500,000 fine
Parkes - a statutory maximum sentence of life imprisonment, a mandatory minimum sentence of ten years’ imprisonment, and a $10,250,000 fine
Watson and Shirley - a statutory maximum sentence of life imprisonment, a mandatory minimum sentence of ten years’ imprisonment, and a $10,000,000 fine
Purrier - a statutory maximum sentence of 65 years’ imprisonment, a mandatory minimum sentence of five years’ imprisonment, and a $5,750,000 fine
Washington - a statutory maximum sentence of life imprisonment, a mandatory minimum sentence of ten years’ imprisonment, and a $12,500,000 fine.
“This indictment is a great example of how our different law enforcement partners can combine resources to combat corruption within the federal government," said Acting United States Attorney Louis D. Lappen. "The U.S. Attorney’s Office will continue to investigate and prosecute postal service and other federal employees who undermine the integrity of government operations through bribery and other unlawful conduct.”
“The vast majority of the Postal Service’s 600,000 employees nationwide are dedicated, hard-working individuals worthy of America’s trust," said Monica Weyler, U.S. Postal Service Office of Inspector General Special Agent in Charge, Philadelphia, PA. "However, a very small number of them choose to violate that trust by engaging in misconduct or criminal activity. Special agents with the U.S. Postal Service Office of Inspector General work with other law enforcement agencies to find those employees, investigate them, and seek their criminal prosecution and removal from the Postal Service, as we did in this case. To report criminal activity or serious misconduct by postal employees, contact USPS OIG special agents at 888-USPS-OIG or www.uspsoig.gov.”
The case was investigated by the United States Postal Service, Office of Inspector General (USPS-OIG), Homeland Security Investigations (HSI) Border Enforcement Security Taskforce (BEST), and the Pennsylvania Office of Attorney General, Bureau of Narcotics Investigations (BNI) and is being prosecuted by Assistant United States Attorneys Anita Eve and Tomika N.S. Patterson.
[1] An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Two New Haven Trustees Charged with Demanding and Taking BribesRead the Press Release
An elected Trustee of New Haven, Michigan was charged today in a criminal complaint with demanding and taking a bribe in exchange for his official acts in connection with a municipal contract, United States Attorney Barbara McQuade announced. In addition, a former Trustee of New Haven was charged in a criminal information with accepting multiple bribes.
McQuade was joined in the announcement by FBI Special Agent in Charge David P. Gelios and Manny J. Muriel, Special Agent in Charge, Internal Revenue Service-Criminal Investigation, Detroit Field Office.
Christopher Craigmiles, 43, of Lenox Township, is charged in a complaint with engaging in corrupt activity, including demanding and accepting money in exchange for official acts as a Trustee of New Haven. Craigmiles is a current, elected Trustee of the Village of New Haven. Brett Harris, 57, of New Haven, is charged in an information with accepting multiple bribes in exchange for a promise to support a future municipal contract for the village. Harris was an elected Trustee of New Haven until losing re-election in November 2016. The charges against Craigmiles and Harris are part of an ongoing and long-running investigation into systemic corruption in multiple municipalities in southeast Michigan, primarily Macomb County. The investigation has employed telephone wiretaps, consensual audio and video recordings by cooperative individuals, undercover operations, physical surveillance, telephone tracking warrants, and subpoenas of financial records and other documents.
The criminal information against Harris charges that Harris conspired with Craigmiles and former Clinton Township Trustee Dean Reynolds to engage in bribery in the summer of 2016. Reynolds unwittingly introduced Harris to an undercover FBI agent who was posing as a consultant to a company that has contracts with various municipalities in southeast Michigan—referred to in the information as “Company A.” Reynolds told the undercover agent that Harris was a public official who would be willing to take bribes in exchange for his vote on a future contract with Company A. Previously, Reynolds had accepted $17,000 in cash bribes from the undercover agent and between $50,000 and $70,000 in bribes from an executive of Company A, and Reynolds is currently charged in a pending federal indictment. After being introduced to the undercover agent by Reynolds, Harris accepted multiple bribes amounting to $11,000 in cash from the undercover agent in exchange for his vote as a Trustee on a future contract between New Haven and Company A. In August 2016, Harris then introduced the undercover agent to Craigmiles. Harris identified Craigmiles as being another New Haven Trustee who would accept bribes. The criminal complaint charges Craigmiles with accepting a $5,000 cash bribe from the undercover FBI agent in August 2016. Craigmiles agreed to support a future contract for Company A in exchange for the money.
“Our elected officials must make decisions based on what is best for the people and our communities, not based on whether they are given cash,” said U.S. Attorney McQuade. “Elected officials who violate the public trust by accepting bribes must be arrested and prosecuted.”
"Today's announcement of public corruption charges, in the Village of New Haven, demonstrates the FBI's unyielding commitment to aggressively investigate public servants, past or present, who accept bribes in exchange for official actions, said David P. Gelios, Special Agent in Charge, Detroit Division of the FBI. "Illegal conduct as described today erodes the trust and confidence community members place in their elected officials and threatens the integrity of our system of governance."
This investigation is being conducted by the FBI Detroit Area Corruption Task Force, a multiagency task force led by the FBI Detroit Division and comprised of the Internal Revenue Service – Criminal Investigation Division, Michigan State Police, Michigan Attorney General’s Office, and several other local and federal law enforcement agencies. It is being prosecuted by Assistant United States Attorneys R. Michael Bullotta and David A. Gardey.
Upon conviction for a violation of Title 18, United States Code, Section 666, federal program bribery, Craigmiles faces a maximum of ten years in prison and a fine of up to $250,000. Upon conviction for a violation of Title 18, United States Code, Section 371, conspiracy to commit federal program bribery, Harris faces a maximum of five years in prison and a fine of up to $250,000.
Court appearances for Craigmiles and Harris will take place sometime next week.
A complaint and an information are only charges and are not evidence of guilt. Trial cannot be held on felony charges in a complaint. When the investigation is completed a determination will be made whether to seek a felony indictment.
The FBI requests that anyone having information regarding public officials accepting bribes is encouraged to contact the Detroit Division of the FBI at 313-965-2222.
Two Men Sentenced for Drug Conspiracy and Possession of a Firearm During a Drug Trafficking OffenseRead the Press Release
St. Thomas, USVI – On January 11, 2017, District Court Judge Curtis V. Gomez sentenced Alexandro Geraldino-Aracena, 39, of the Dominican Republic, to 202 months’ imprisonment for conspiracy and possession with intent to distribute cocaine, followed by five years of supervised release, United States Attorney Ronald W. Sharpe announced. Geraldino-Aracena was also sentenced to a consecutive 60-month term for possession of a firearm during a drug trafficking offense. Co-defendant Ricardo Cardona, 35, of Puerto Rico, was sentenced to 214 months’ imprisonment for conspiracy and possession with intent to distribute cocaine, followed by five years of supervised release. Cardona was also sentenced to a consecutive 60-month term for possession of a firearm during a drug trafficking offense. Judge Gomez also ordered Geraldino-Aracena and Cardona to each pay a $400 special assessment and perform 300 hours of community service.
According to evidence presented at trial, on the morning of September 3, 2015, Gerandino-Aracena and Cardona traveled in a private vessel equipped with a hidden compartment from Fajardo, Puerto Rico, to St. Thomas to purchase 150 kilograms of cocaine. They docked their vessel at the University of the Virgin Islands Marine Center Dock where they met other members of the drug trafficking organization to collect the cocaine in exchange for $250,000 and three assault rifles. Earlier that day in Puerto Rico, U.S. Drug Enforcement Administration (DEA) agents seized $1.4 million dollars in cash, which was partial payment for the cocaine.
This case was investigated by the DEA, the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives and U.S. Customs and Border Protection. It was prosecuted by Assistant United States Attorneys Sigrid M. Tejo-Sprotte and Delia Smith.
Topeka Man Indicted on Bank Robbery ChargeRead the Press Release
TOPEKA, KAN. – A federal grand jury returned an indictment Wednesday charging a Topeka man with bank robbery, U.S. Attorney Tom Beall said.
Dakota Shareef Walker, 20, Topeka, Kan., is charged with one count of bank robbery. The indictment alleges that on Nov. 28, 2016, he robbed the U.S. Bank at 5730 Southwest 21st Street in Topeka.
If convicted, he faces up to 20 years in federal prison and a fine up to $250,000. The FBI and the Topeka Police Department investigated. Assistant U.S. Attorney Jared Maag is prosecuting.
OTHER GRAND JURY INDICTMENTS
Jesus S. Arrendondo, 26, Kansas City, Kan., is charged with one count of assaulting a person on federal property with intent to commit bodily harm. The crime is alleged to have occurred Nov. 6, 2016 at Fort Riley.
If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The Fort Riley Police Department investigated. Assistant U.S. Attorney Duston Slinkard and Special Assistant U.S. Attorney Robin Graham are prosecuting.
Donald R. Schooler, 56, is charged with failing to register as required under the federal Sex Offender Registration and Notification Act.
If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The U.S. Marshal Service investigated. Assistant U.S. Attorney Christine Kenney is prosecuting.
Roberto Munoz-Aguilar, 41, a citizen of Mexico, is charged with unlawfully re-entering the United States after being deported. He was found Nov. 21, 2016, in Ford County, Kan.
If convicted, he faces up to two years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement’s Enforcement and Removal Operations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct
Three Men Sentenced in Major Cocaine ConspiracyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.- Acting U.S. Attorney James P. Kennedy, Jr. announced today that Rafael Burgos, Alvin Torres, Jr., and Angel Pierluissi were sentenced by U.S. District Judge Elizabeth A. Wolford for their roles in a Dunkirk, New York area cocaine conspiracy. Burgos, who was convicted of conspiracy to possess with intent to distribute, and to distribute, five kilograms or more of cocaine, was sentenced to 75 months in prison. Torres and Pierluissi, who were convicted of possessing with intent to distribute and distributing cocaine, were each sentenced to 18 months in prison.
Assistant U.S. Attorney Michael J. Adler, who is handling the case, stated that between 2013 and June 10, 2015, law enforcement officers investigated a drug trafficking organization led by defendants Burgos and David Jesus Pagan. During the course of that investigation, it was determined that the defendants distributed multiple kilograms of cocaine throughout the Dunkirk area.
Burgos, Torres, and Pierluissi were arrested in June of 2015 along with Samuel Hernandez III, Javier Pagan, Jr., and David Jesus Pagan. All six defendants have been convicted. Search warrants were executed at the time of the arrests at six properties which resulted in the recovery of more than seven kilograms of cocaine (the largest seizure ever in the City of Dunkirk) and approximately $175,000 in cash as well as an AR-15 assault rifle with a 30 round magazine. During a search of Burgos’ residence, officers discovered a secret room with a money counting machine.
The sentencings are the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge James J. Hunt, New York Field Office; the Dunkirk Police Department, under the direction of Chief David C. Ortolano; the Chautauqua County Sheriff’s Office, under the direction of Sheriff Joseph A. Gerace; the Cattaraugus County Sheriff’s Office, under the direction of Sheriff Timothy S. Whitcomb; and the Chautauqua County District Attorney’s Office, under the direction of Patrick Swanson.Three Doctors and Three Executives Charged in $33 Million Medicare and Medicaid Fraud SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Dennis Rosen, Inspector General of the New York State Office of the Medicaid Inspector General (“OMIG”), announced the unsealing today of a superseding indictment charging physicians MUSTAK Y. VAID, PAUL J. MATHIEU, and EWALD J. ANTOINE, as well as health-care executives MARINA BURMAN, ASHER OLEG KATAEV, a/k/a “Oleg Kataev,” and ALLA TSIRLIN with operating a $33 million health care fraud scheme through the operation of eight fraudulent medical clinics in Brooklyn, as well as the operation of related suppliers of medical equipment, tests, and services. As part of the fraud scheme, the defendants’ co-conspirators paid cash kickbacks to elderly and financially disadvantaged patients (the “Paid Patients”) who were insured by Medicare and/or Medicaid, and the defendants and their co-conspirators then billed Medicare and Medicaid for unnecessary medical services, tests, and supplies related to the Paid Patients.
VAID was previously indicted and arrested on these charges in November 2016. MATHIEU, ANTOINE, BURMAN, KATAEVE, and TSIRLIN were arrested earlier today and presented and arraigned this afternoon before U.S. Magistrate Judge Kevin Nathaniel Fox. The case is assigned to U.S. District Judge Lorna G. Schofield.
U.S. Attorney Preet Bharara said: “These defendants allegedly operated fraudulent medical clinics and suppliers in a scheme that bilked Medicare and Medicaid out of more than $30 million. As alleged, three of the defendants were doctors who, in violation of their Hippocratic oath, signed medical charts for patients they never treated and prescribed unnecessary medications, procedures, and supplies. Medicare and Medicaid were established to assist the elderly and economically disadvantaged, not to serve as cash cows for allegedly corrupt professionals.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. said: “In this case, as alleged, Medicare and Medicaid programs suffered millions of dollars in losses when a group of physicians and health-care executives created, operated, or became associated with eight fraudulent medical clinics. As charged, their litany of crimes included paying a series of kickbacks, writing scripts for unnecessary medical tests, and arranging transportation services for patients who didn’t need a ride. Today’s charges certainly won’t prove to be a cure for all ills, but they are a step in the right direction when it comes to confronting the threats faced by the health care system.”
Medicaid Inspector General Dennis Rosen said: “This joint investigation and today's arrests send an unmistakable message. Those who seek personal gain by preying upon vulnerable New Yorkers and exploiting the Medicaid program will be held fully accountable. My office will continue to work closely with our partners in the U.S. Attorney’s Office, FBI and other state and federal agencies to root out fraud, waste and abuse in the Medicaid program.”
As alleged in the Indictment unsealed today and according to statements made in Court today: [1]
Aleksandr Burman, an individual with no medical license, established eight medical clinics in Brooklyn (the “Related Clinics”), which operated between 2007 and 2013. For each clinic, Aleksandr Burman hired one of three doctors – VAID, MATHIEU, or ANTOINE – to pose as the nominal owner of the clinic, since New York State law requires that a professional services corporation providing medical care must be owned by a medical professional. In fact, however, VAID, MATHIEU, and ANTOINE were each simply hired by Aleksandr Burman to pose as the owner of one or more of the clinics, and to come to the clinic periodically, in order to sign medical charts falsely stating that the doctor had examined a number of Paid Patients. VAID posed as the owner of one such clinic, while MATHIEU posed as the owner of four others, and ANTOINE posed as the owner of the remaining three. The three doctors were also paid to provide a large number of prescriptions and referrals for medically unnecessary supplies. Such unnecessary prescriptions included referrals for more than $3.5 million worth of durable medical equipment (“DME”), consisting mostly of incontinence supplies such as adult diaper sets ordered from a DME supply company (“USD”) owned jointly by BURMAN and Aleksandr Burman of the Related Clinics.
Many of the Paid Patients who received such prescriptions and referrals did not need or receive the diapers and other supplies. Instead, BURMAN and USD arranged for the Paid Patients to exchange their diaper prescriptions for valuable merchandise, such as bed linens, tablecloths, dishes, kitchen appliances, and other housewares. BURMAN and USD nonetheless filed Medicaid claims for such DME, seeking more than $3.5 million in reimbursement. BURMAN also transported cash to the Related Clinics to be used to pay kickbacks to the Paid Patients.
VAID, MATHIEU, ANTOINE, and their co-conspirators also provided medical referrals for transportation services to hundreds of Paid Patients, even though such transportation was not medically necessary. This practice generated more than $4 million in losses to Medicaid. In addition, VAID, MATHIEU, and ANTOINE provided referrals and prescriptions for medically unnecessary diagnostic tests, including MRIs, as well as prescriptions for medications such as expensive ointment compounds. The defendants and their co-conspirators then sent such medical referrals to specific medical testing companies, which in turn provided kickbacks to Aleksandr Burman.
In 2012, KATAEV and TSIRLIN became business partners of Aleksandr Burman, and operated as the managers of two of the Related Clinics. Their activity as managers included paying cash kickbacks directly to Paid Patients, and employing MATHIEU and ANTIONE to pose as the owners of the two clinics.
In or about March 2016, Aleksandr Burman pled guilty for his role in these offenses. He is scheduled to be sentenced on February 15, 2017, before the Honorable Paul G. Gardephe.
* * *
VAID, 43, of Brownstown Township, Michigan, MATHIEU, 51, of Morristown, New Jersey, ANTOINE, 66, of Valley Stream, New York, BURMAN, 54, of Manhattan, KATAEV, 48, of Staten Island, and TSIRLIN, 46, of Brooklyn, are all charged with: (1) conspiring to commit health care fraud, mail fraud, and wire fraud, which carries a maximum sentence of 20 years in prison; (2) the substantive offenses of mail fraud and wire fraud, each of which carries a maximum sentence of 20 years in prison; (3) the substantive offense of health care fraud, which carries a maximum sentence of 10 years in prison; and (4) conspiring to make false statements relating to a federal health care program, which carries a maximum penalty of five years in prison. BURMAN, KATAEV, and TSIRLIN are also charged with conspiring to violate the Anti-Kickback Statute, which has a maximum penalty of five years in prison.
The statutory maximum sentences are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendants would be determined by the judge.
Mr. Bharara praised the investigative work of the New York FBI’s Health Care Fraud Task Force.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney David Raymond Lewis is in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
The Department of Justice Releases New Report on the Attorney General’s Twelve-City Community Policing Tour and Regional Justice ForumsRead the Press Release
As part of the Department’s commitment to working with communities and law enforcement to build stronger relationships and mutual trust, Attorney General Loretta E. Lynch today announced the release of the “Attorney General’s Community Policing Report,” a summary of the Attorney General’s twelve-city Community Policing Tour and the Department of Justice’s four Regional Justice Forums. The Attorney General’s Community Policing Tour Report builds on President Obama’s priorities to engage with law enforcement and other members of the community to implement key recommendations from the Final Report of the President’s Task Force on 21st Century Policing.
“This document is not meant to be a comprehensive, step-by-step guide, but, rather, a useful blueprint—a window into what citizens across the nation are doing to build stronger bonds between police and the people they serve,” said Attorney General Lynch. “I hope that this report will help inspire ideas and foster cooperation in communities from coast to coast—so that, together, we can continue our work toward a stronger, a safer, and a more united nation.”
During the Community Policing Tour, Attorney General Lynch visited 12 jurisdictions in two phases. Phase I focused on jurisdictions that had addressed difficult histories of mistrust between communities and law enforcement through strong collaboration and innovation. During this phase, the Attorney General traveled to Cincinnati, Ohio; Birmingham, Alabama; East Haven, Connecticut; Pittsburgh, Pennsylvania; Seattle, Washington; and Richmond, California. Phase II highlighted cities that had made outstanding progress implementing the six key pillars identified in the Final Report of the President’s Task Force on 21st Century Policing. During this phase, the Attorney General visited Miami/Doral, Florida; Portland, Oregon ; Indianapolis, Indiana; Fayetteville, North Carolina; Phoenix, Arizona; and Los Angeles, California, with each site focusing on one of the report’s pillars.
In the wake of the horrific tragedies of the summer of 2016 in Baton Rouge, Louisiana; Dallas, Texas; and St. Paul, Minnesota, the Attorney General and Deputy Attorney General Sally Q. Yates convened a series of Regional Justice Forums with members of the local law enforcement, youth, faith, non-profit and civil rights communities. These meetings were designed to help local stakeholders critically examine community policing issues in their respective cities and regions and to seek concrete solutions together. The Attorney General convened Justice Forums in Detroit, Michigan and Newark, New Jersey. The Deputy Attorney General hosted forums in Denver, Colorado, and Atlanta, Georgia.
This report chronicling the community policing work of the Department of Justice highlights innovative local approaches to policing that help foster stronger ties between officers and the people they are sworn to serve and protect. The document is meant to serve as a tool for communities and law enforcement agencies seeking to deepen their own commitment to community policing principles and practices.
The Department of Justice Releases New Report on the Attorney General’s Twelve-City Community Policing Tour and Regional Justice ForumsRead the Press Release
As part of the Department’s commitment to working with communities and law enforcement to build stronger relationships and mutual trust, Attorney General Loretta E. Lynch today announced the release of the “Attorney General’s Community Policing Report,” a summary of the Attorney General’s twelve-city Community Policing Tour and the Department of Justice’s four Regional Justice Forums. The Attorney General’s Community Policing Tour Report builds on President Obama’s priorities to engage with law enforcement and other members of the community to implement key recommendations from the Final Report of the President’s Task Force on 21st Century Policing.
“This document is not meant to be a comprehensive, step-by-step guide, but, rather, a useful blueprint—a window into what citizens across the nation are doing to build stronger bonds between police and the people they serve,” said Attorney General Lynch. “I hope that this report will help inspire ideas and foster cooperation in communities from coast to coast—so that, together, we can continue our work toward a stronger, a safer, and a more united nation.”
During the Community Policing Tour, Attorney General Lynch visited 12 jurisdictions in two phases. Phase I focused on jurisdictions that had addressed difficult histories of mistrust between communities and law enforcement through strong collaboration and innovation. During this phase, the Attorney General traveled to Cincinnati, Ohio; Birmingham, Alabama; East Haven, Connecticut; Pittsburgh, Pennsylvania; Seattle, Washington; and Richmond, California. Phase II highlighted cities that had made outstanding progress implementing the six key pillars identified in the Final Report of the President’s Task Force on 21st Century Policing. During this phase, the Attorney General visited Miami/Doral, Florida; Portland, Oregon ; Indianapolis, Indiana; Fayetteville, North Carolina; Phoenix, Arizona; and Los Angeles, California, with each site focusing on one of the report’s pillars.
In the wake of the horrific tragedies of the summer of 2016 in Baton Rouge, Louisiana; Dallas, Texas; and St. Paul, Minnesota, the Attorney General and Deputy Attorney General Sally Q. Yates convened a series of Regional Justice Forums with members of the local law enforcement, youth, faith, non-profit and civil rights communities. These meetings were designed to help local stakeholders critically examine community policing issues in their respective cities and regions and to seek concrete solutions together. The Attorney General convened Justice Forums in Detroit, Michigan and Newark, New Jersey. The Deputy Attorney General hosted forums in Denver, Colorado, and Atlanta, Georgia.
This report chronicling the community policing work of the Department of Justice highlights innovative local approaches to policing that help foster stronger ties between officers and the people they are sworn to serve and protect. The document is meant to serve as a tool for communities and law enforcement agencies seeking to deepen their own commitment to community policing principles and practices.
Suffolk Man Sentenced to 59 Years for 10 Armed RobberiesRead the Press Release
NORFOLK, Va. – Arthur Santiful, 27, of Suffolk, was sentenced today to 59 years in prison for 10 armed robberies he committed in August and September 2015 in South Hampton Roads and the Peninsula.
“Violent crime will be met with significant consequences,” said Dana J. Boente, U.S. Attorney for the Eastern District of Virginia. “This sentence reflects the fair and measured judgment of the court in the case of two armed robbers, one who accepted responsibility for the harm he caused, and the other who did not.”
Santiful was found guilty on all counts on Sept. 12, 2016, after a four-day jury trial. According to trial testimony, Santiful and a co-conspirator, Michael Zeigler, robbed at gunpoint eight 7-Eleven stores, a hotel, and a pizza delivery driver during a six-week crime spree in August and September 2015. Santiful was armed during each of the robberies and witnesses testified that he shot at one robbery victim, pistol-whipped a second victim, and told several clerks that they would die if they did not hand over the money and cigarettes the men sought. In addition to the 10 charged robberies, Santiful was also charged with two counts of brandishing and discharging a firearm during a crime of violence, and with being a felon in possession of a firearm.
Zeigler pleaded guilty and accepted responsibility for his crimes. He was sentenced on Dec. 20, 2016, to 14 years in prison.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Martin Culbreth, Special Agent in Charge of the FBI’s Norfolk Field Office; Michael B. Boxler, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division; James A. Cervera, Chief of Virginia Beach Police; Tonya D. Chapman, Chief of the Portsmouth Police Department; Michael Goldsmith, Chief of Norfolk Police; Richard Myers, Chief of Newport News Police Department; and Terry L. Sult, Chief of Hampton Police Division, made the announcement after sentencing by U.S. District Judge Arenda L. Wright Allen. The case was prosecuted by Assistant U.S. Attorneys Joseph E. DePadilla and Andrew Bosse, and Special Assistant U.S. Attorney John F. Butler.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:15-cr-160.
Statement by Attorney General Loretta E. Lynch on the Departure of Joyce White Vance from the Northern District of AlabamaRead the Press Release
Attorney General Loretta E. Lynch released the following statement on the planned departure of Joyce White Vance, U.S. Attorney for the Northern District of Alabama.
“Since the first year of the Obama Administration, U.S. Attorney Joyce White Vance has served the people of the Northern District of Alabama – and all of the American people – with compassion and integrity,” said Attorney General Lynch.
“During her tenure, she oversaw the development of a comprehensive initiative to tackle opioid and heroin addiction. She helped lead an ongoing investigation into abuse in Alabama prisons. She fought corruption and brought actions to protect the rights of immigrants. And she has been a valuable partner in the department’s efforts to improve relationships between police officers and the people they serve, including by welcoming me to Birmingham in 2015 during my Community Policing Tour. In these and in so many other ways, Joyce has been a dedicated servant of the law and a tireless champion of justice. I thank her for her outstanding contributions to the Department of Justice, and I wish her well in her future endeavors.”
Sinaloa Cartel Member Sentenced to Federal Prison for Conspiracy to Kill in a Foreign CountryRead the Press Release
In El Paso, 34-year-old Francisco Javier Pulido was sentenced yesterday to 24 years in federal prison followed by five years of supervised release and ordered to pay a $5,000 fine for the death of a Horizon City, TX, resident in September 2009 announced United States Attorney Richard L. Durbin, Jr., Federal Bureau of Investigation Special Agent in Charge Douglas E. Lindquist, El Paso Division, and Drug Enforcement Administration Special Agent in Charge Will Glaspy, El Paso Division.
On October 26, 2016, Pulido pleaded guilty to one count of conspiracy to kill, kidnap or injure in a foreign country. By pleading guilty, Pulido admitted to conspiring with others in the kidnapping and murder of Sergio Saucedo from his home in Horizon City on September 3, 2009. The kidnapers took Saucedo to Ciudad Juarez, Mexico, where he was murdered and mutilated in retaliation for the loss of a 670-pound marijuana load seized by authorities at the Sierra Blanca checkpoint.
With this sentencing, this investigation has resulted in federal convictions and prison sentences for five individuals in connection with the Saucedo kidnapping and murder. Rafael Vega and Cesar Obregon-Reyes each received life imprisonment; Cesar Pineda received 20 years imprisonment; and, Omar Obregon-Ortiz received 100 months imprisonment.
This case was investigated by agents with the Drug Enforcement Administration, Federal Bureau of Investigation, U.S. Border Patrol, El Paso County Sheriff’s Department and the El Paso County District Attorney’s office.
Shreveport man pleads guilty to threatening Washington, D.C., pizzeriaRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced today that a Shreveport man pleaded guilty to calling a Washington, D.C., pizzeria and threating to shoot those there.
Yusif Lee Jones, 52, of Shreveport, pleaded guilty before U.S. District Judge S. Maurice Hicks Jr. to one count of interstate threatening communications. According to testimony at the guilty plea, on December 7, 2016, three days after the shooting at the Comet Ping Pong pizza shop in Washington, D.C., which was reported on by the national news media and generally referred to as “Pizzagate,” 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.” Further investigation by the Washington, D.C., Metropolitan Police Department and the FBI traced the call to Jones in Shreveport. Jones admitted to making the threatening call and was arrested.
Jones faces up to five years in prison, three years of supervised release, restitution and a $250,000 fine. A sentencing date of April 12, 2017 was set.
The Federal Bureau of Investigation and the Washington, D.C., Metropolitan Police Department conducted the investigation. Assistant U.S. Attorney William J. Flanagan is prosecuting the case.
Shelbyville Woman Sentenced to 25 Years for Producing Images of Child PornographyRead the Press Release
FRANKFORT, Ky. – A Shelbyville, Ky., woman, previously convicted of photographing images of children engaged in sexually explicit conduct, has been sentenced to 25 years in federal prison.
On Wednesday, U.S. District Judge Gregory F. Van Tatenhove sentenced Melissa Torres, 37, for enticing a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of that conduct. He also ordered her to serve a lifetime of supervised release following the completion of her sentence. Under federal law, Torres must serve at least 85 percent of her prison sentence.
Torres admitted that, on September 22, 2014, she coerced two children under the age of 10 to engage in sexually explicit conduct and took video of the encounter. She later distributed the video.
The Shelbyville Police Department began an investigation after someone found the child pornography images and notified the police.
Kerry B. Harvey, United States Attorney for the Eastern District of Kentucky; Amy Hess, Special Agent in Charge, FBI; and Danny Goodwin, Shelbyville Police Chief, jointly made the announcement.
The investigation was conducted by the FBI and the Shelbyville Police. Assistant U.S. David Marye prosecuted this case on behalf of the federal government.
Sentencings for January 12, 2017Read the Press Release
Esequiel De Jesus-Bello, 40, of Mexico, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on January 12, 2017, for illegal re-entry of a previously deported alien into the United States. Jesus-Bello was arrested in Douglas, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
John Weber, 28, of Evanston, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on January 12, 2017, for possession of child pornography. Weber was arrested in Evanston, Wyoming. He received 63 months of imprisonment, to be followed by 10 years of supervised release, and was ordered to pay a $100.00 special assessment, a $5,000 special assessment for victims of trafficking, and restitution in the amount of $2,500.00. This case was investigated by the Division of Criminal Investigation Internet Crimes Against Children Task Force.
Second Foreign Currency Exchange Dealer Pleads Guilty to Antitrust ConspiracyRead the Press Release
A foreign currency exchange (FX) dealer became the second person to plead guilty to conspiring to fix prices in the FX market, the Justice Department announced today.
According to the one-count information filed in the U.S. District Court for the Southern District of New York, Christopher Cummins was a dealer of Central and Eastern European, Middle Eastern and African (CEEMEA) currencies on the FX desk of a New York-based financial institution. From approximately January 2007 until July 2013, Cummins and FX dealers at competing institutions conspired to suppress and eliminate competition by fixing prices in CEEMEA currencies, in violation of the Sherman Act, 15 U.S.C. § 1. As part of this conspiracy, Cummins and his co-conspirators manipulated prices on an electronic FX trading platform through the creation of non-bona fide trades, coordinated the placement of bids and offers on that platform and agreed on currency prices they would quote specific customers, among other conduct. Under his plea agreement, Cummins has agreed to cooperate with the department’s ongoing investigation into the FX market.
“Collusion by FX dealers for the purpose of fixing foreign currency exchange rates is no different than collusion regarding traditional products and services that the Antitrust Division routinely prosecutes,” said Deputy Assistant Attorney General Brent Snyder of the Justice Department’s Antitrust Division. “The exchange rate manipulation pursued by the charged CEEMEA FX dealers and their co-conspirators, like any other form of price fixing, was intended to stymie free competition that promotes market integrity and fair pricing.”“The Federal Deposit Insurance Corporation Office of Inspector General (FDIC OIG) is dedicated to ensuring integrity in the financial services industry,” said Inspector General Jay N. Lerner of the FDIC OIG. “This is the second guilty plea in this price-fixing case and attests to the value of cooperative working relationships among law enforcement.”
In addition to the guilty plea by Cummins, another FX dealer pleaded guilty on January 4, 2017, to fixing prices of CEEMEA currencies, three individuals were charged on Jan. 10, 2017 for conspiring to fix prices and rig bids for the euro – U.S. dollar currency pair, and the Justice Department’s Criminal Division charged two FX executives with fraud, on July 20, 2016, for conspiring to defraud a client of their bank through a front running scheme. These individual charges follow guilty pleas by major banks. On May 20, 2015, Citicorp, JPMorgan Chase & Co., Barclays PLC and The Royal Bank of Scotland plc pleaded guilty at the parent level and agreed to pay collectively more than $2.5 billion in criminal fines for their participation in an antitrust conspiracy to manipulate the price of U.S. dollars and euros exchanged in the FX market.
This antitrust investigation is being conducted by the Antitrust Division’s New York Office with the assistance of the FDIC OIG and the FBI’s Washington Field Office. The Criminal Division’s Fraud Section also provided substantial assistance in this matter.
A violation of the Sherman Act, 15 U.S.C. § 1, carries a maximum penalty of ten years in prison and a $1 million fine for individuals. The maximum fine for a Sherman Act violation may be increased to twice the gain derived from the crime or twice the loss suffered by victims if either amount is greater than the statutory maximum.
The charge was brought in connection with the President Obama’s Financial Fraud Enforcement Task Force. The president established the task force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ Offices and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants.
For more information about the task force, please visit www.StopFraud.gov. Anyone with information concerning price fixing or other anticompetitive conduct in the FX marketplace should contact the New York Office of the Antitrust Division at (212) 335-8000, call the Antitrust Division’s Citizen Complaint Center at (888) 647-3258 or visit www.justice.gov/atr/contact/newcase.html.
Cummins Information
Saint Paul Woman Sentenced to Two Years in Prison for Using Stolen Identities to File Fraudulent Income Tax ReturnsRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of EBONY SHANTE YARBROUGH, 28, to two years in prison for aggravated identity theft. YARBROUGH pleaded guilty on August 12, 2016, before U.S. District Judge Patrick J. Schiltz in U.S. District Court in Minneapolis, Minn.
“Tax season is almost here and the sentencing of Ebony Yarbrough for filing false tax returns is a powerful reminder of what can happen when you decide to steal from honest taxpayers,” said Shea Jones, Special Agent in Charge of the St. Paul Field Office. “Through our partnership with the US Attorney’s Office and other law enforcement agencies, IRS Criminal Investigation’s Special Agents will continue the aggressive pursuit of those who would attempt to defraud America's tax system.”
According to the defendant’s guilty plea, between 2013 and 2015, YARBROUGH convinced friends and family members to allow her to file their state and federal income tax returns by claiming she knew how to prepare the returns and would charge less than a tax preparation service.
According to her guilty plea, YARBROUGH prepared taxpayers’ returns by claiming false Schedule C income characterized as “hair stylist,” “cleaner” or “exotic dancer.” Additionally, YARBROUGH included dependents on taxpayers’ returns by using stolen personal identifying information belonging to minors, enabling them to qualify for other tax credits. YARBROUGH’S scheme accounted for more than $500,000 in false state and federal claims.
This case is the result of an investigation conducted by the Criminal Investigation Division of the IRS. The Minnesota Department of Revenue assisted in the investigation.
Assistant U.S. Attorney Kimberly A. Svendsen prosecuted the case.
Defendant Information:
EBONY SHANTE YARBROUGH, 28
Saint Paul, Minn.Convicted:
• Aggravated Identity Theft, 1 countSentenced:
• 24 months in prison
• Restitution in the amount of $298,054.01SRCTec, LLC to Pay over $6.3 Million to Resolve False Claims Act AllegationsRead the Press Release
SYRACUSE, NEW YORK - SRCTec, which manufactures a lightweight counter mortar radar system (the “radar system”) and associated replacement parts pursuant to contracts with the Department of the Army, will pay over $6.3 million in consideration to resolve False Claims Act allegations concerning its invoicing for the radar system and spare parts, announced United States Attorney Richard S. Hartunian. SRCTec has separately agreed to a remediation plan, to be performed at its own expense, with respect to previously delivered products.
The radar system serves an important function for America’s warfighters by providing early warning of incoming mortar and rocket fire and information about the location from which that fire emanated (“source-of-fire”). This source-of-fire data enables a targeted counter-fire response. The radar system provides continuous 360-degree monitoring and source-of-fire data through a non-rotating 24-column array. Among other replacement parts, SRCTec produces column spares for use when a column for the radar system fails or is damaged or destroyed. Pursuant to SRCTec’s contract with the Army, “initial spares and ancillary items shall be form, fit and functionally interchangeable with the parts they are intended to replace.”
SRCTec became aware of anomalies in source-of-fire accuracy data in certain combinations of initial system columns and column spares in March 2013. At that time, SRCTec summarized the issues in a Problem Report uploaded to a database shared by SRCTec and the Army. SRCTec designated the Problem Report at a priority level that indicated that a work-around existed for the identified problem. Higher level priority designations were available but were not selected, although SRCTec did not know in March 2013 what caused the anomalies or have a solution that would eliminate them. Problem Reports at the priority level selected by SRCTec are part of the normal life cycle of the program, and problem reporting is not the exclusive method (under the applicable contracts or otherwise) for SRCTec to notify the Army of issues with the radar system.
Over the ensuing months after March 2013, SRCTec learned more about the circumstances in which the source-of-fire accuracy anomalies would manifest themselves and how they might be mitigated in the field. By August 2013, SRCTec described an increased risk of degraded source-of-fire accuracy as a “known” problem in an internal memorandum that was not shared with the Army. SRCTec did set forth certain additional material details concerning degraded source-of-fire accuracy in various additional Problem Reports also uploaded to the shared database, all of which were designated at the same priority level as the initial Problem Report, although SRCTec had not actually identified a work-around through at least the summer of 2013. A potential solution was eventually identified by SRCTec in March 2014, and in the fall of 2014 SRCTec began testing what would become the solution for newly manufactured systems and column spares.
In March 2015, SRCTec requested a meeting with the Army, which was held in April 2015. At the meeting, SRCTec disclosed how it learned of and ultimately solved the increased risk of degraded source-of-fire accuracy from the use of column spares and original system columns in certain combinations, explained the circumstances under which the increased risk was such that source-of-fire accuracy could potentially fall outside the required accuracy performance specification, explained how the increased risk of degraded source-of-fire accuracy could be mitigated, and advised that the systems’ ability to perform their sense and warn function was never impacted. Since April 2015, the Army has ensured that all fielded systems are operating without any increased risk of degraded source-of-fire accuracy, and all fielded systems are currently functioning within their source-of-fire performance parameters. There have been no reported field failures.
During the time period covered by the Settlement Agreement, SRCTec invoiced the Army for radar systems and column spares (which were verified as operable by the Army) at a cost of tens of millions of dollars. The increased risk of degraded source-of-fire accuracy from the use of column spares in certain combinations with original system columns would not have been identified by the fielded systems’ self-diagnostic testing nor necessarily been recognized by soldiers.
United States Attorney Hartunian said: “Our office is committed to ensuring that federal programs receive products that perform as paid for, and we pursue False Claims Act claims vigorously. The stakes are particularly high when the procurement involves protection for our nation’s warfighters. This settlement reflects the importance of the case, the fine work of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit and the Defense Criminal Investigative Service, and SRCTec’s disclosure of the problem and cooperation in addressing it.”
“The ability of our equipment to function as required is essential when it comes to purchase of equipment that protects the very lives and limbs of one of our most precious resources - our military members,” said Frank Robey, director of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit.
“This settlement demonstrates the continued commitment of the Defense Criminal Investigative Service (DCIS), partnering with Army CID, Major Procurement Fraud Unit, and the United States Attorney’s Office in the Northern District of New York, to protect the military services and its members from potential failures of warfighting systems,” said Special Agent in Charge Craig W. Rupert, DCIS Northeast Field Office, U.S. Department of Defense Inspector General. “DCIS will continue to tirelessly pursue cases like this in its mission to protect the warfighter and safeguard our national defense.”
The investigation and settlement were the result of a coordinated effort among the United States Attorney’s Office for the Northern District of New York, the United States Army Criminal Investigation Command, and the Defense Criminal Investigative Service. The United States was represented by Assistant U.S. Attorney Michael D. Gadarian.
Rocky River man indicted on methamphetamine and firearms chargesRead the Press Release
A Rocky River man was indicted on drug and firearms charges, said U.S. Attorney Carole S. Rendon and FBI Special Agent in Charge Stephen D. Anthony.
Jamshed Ahmad, 43, was arrested this morning. He was indicted on one count of possession with intent to distribute methamphetamine and one count of being a felon in possession of a firearm.
Ahmad had more than 50 grams of methamphetamine on July 12, 2016, according to the indictment.
On July 12, he possessed a Ruger LCP 380-caliber pistol and ammunition, despite a 2007 conviction for drug trafficking that made it illegal for him to have a firearm, according to the indictment.
If convicted, the court will determine the defendant’s sentence after a review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorney Vasile Katsaros following an investigation by the FBI.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Ringleader of Bank Fraud Scheme that Used Information Stolen by Wells Fargo Employees Sentenced to over 7 Years in Federal PrisonRead the Press Release
LOS ANGELES – The organizer of a bank fraud scheme in which Wells Fargo Bank employees stole customer account data – information that was used to impersonate scores of customers and steal well over a half-million dollars from their accounts – was sentenced today to 89 months in federal prison.
Ronald Charles Reed, 70, of Inglewood, was sentenced this afternoon by United States District Judge Fernando M. Olguin. In addition to the prison term, Judge Olguin ordered Reed to pay $580,332 in restitution to Wells Fargo Bank.
Reed pleaded guilty in March 2016 to bank fraud and aggravated identity theft.
Reed, who is also known as “Disco Ronnie,” admitted that he worked with former Wells Fargo employees and “runners” in a scheme that caused Wells Fargo to suffer approximately $580,000 in losses.
Reed recruited four Wells Fargo employees in 2013 and 2014, asked them to access the bank’s computer records, and then purchased personal identifying information belonging to bank customers. The stolen information included dates of birth, account numbers, driver’s license numbers, and social security numbers.
Reed provided this stolen information to the runners. Using fake IDs, the runners impersonated bank customers and made substantial cash withdrawals from the customers’ accounts. In some cases, the runners also used the customer’s account to deposit worthless checks and receive cash back. The fraudulent transactions were made at Wells Fargo branches across Southern California and in other states, including Minnesota and Nevada.
Reed also admitted that in 2014 he purchased personal identifying information for accounts at U.S. Bank. Unbeknownst to Reed, the information he bought was for undercover accounts supplied by a confidential informant who was working with law enforcement.
Over a 13-month period that ended in mid-2014, Reed’s scheme caused runners to withdraw approximately $580,332 from 75 accounts belonging to Wells Fargo customers and $12,000 from two undercover accounts at U.S. Bank.
“This defendant has a lengthy criminal history, much of which involved fraudulent schemes and identity theft, including a counterfeit credit card case in this district that led to a sentence of nearly five years in federal prison,” said United States Attorney Eileen M. Decker. “In the process of committing these crimes, he stole the identities and bank account funds from innocent people, creating unnecessary havoc in their lives. Innocent victims of identity theft deserve the protection of the criminal justice system, and this sentence attempts to achieve that goal.”
“Fraud ringleaders should be deterred by the strong hand of justice delivered in today’s sentence. We are proud to collaborate with our FBI partners by aggressively pursuing criminals attempting to exploit our nation's financial infrastructure, " said Rob Savage, Special Agent in Charge, U.S. Secret Service, Los Angeles Field Office.
“Mr. Reed mercilessly exposed sensitive information, violating his victims personal and financial security and leaving them vulnerable to additional fraud while convincing others to use their official position at the bank to steal from their employer,” said Deirdre Fike, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “The FBI will continue to work with our partners at the Secret Service and investigators at financial institutions to detect insider crimes and hold the perpetrators accountable.”
The former bank employees who worked with Reed have all pleaded guilty and are pending sentencing. The investigation into the runners – who remain unidentified – remains ongoing. Anyone with information on any of these individuals should contact FBI Special Agent Watkins at (310) 477-6565.
This matter was jointly investigated by the Federal Bureau of Investigation and the United States Secret Service. Wells Fargo Bank and U.S. Bank fully cooperated during the investigation.
The case is being prosecuted by Assistant United States Attorney Christina T. Shay of the Violent and Organized Crime Section.
Prior Felon from Roswell Pleads Guilty to Violating Federal Firearms LawsRead the Press Release
ALBUQUERQUE – Nathaniel Eddie Madrid, 39, of Roswell, N.M., pled guilty this afternoon in federal court in Las Cruces, N.M., to violating the federal firearms laws by unlawfully possessing firearms and ammunition.
Madrid was arrested on April 18, 2016, on a criminal complaint charging him with being a felon in possession of firearms and ammunition and possession of a firearm not registered to him in the National Firearms Registration and Transfer Record (NFRTR) in Lincoln County, N.M. According to the complaint, law enforcement officers recovered three firearms, ammunition, marijuana and drug paraphernalia from Madrid’s vehicle. A search of the NFRTR also revealed that Madrid did not have any firearms registered in his name.
Madrid subsequently was indicted on Aug. 17, 2016, and charged with being a felon in possession of firearms and ammunition on Oct. 26, 2015, in Lincoln County. According to the indictment, Madrid was prohibited from possessing firearms or ammunition because of his prior convictions for possession of a controlled substance, contributing to the delinquency of a minor, breaking and entering, armed robbery with a deadly weapon, and being a felon in possession of a firearm. Court documents indicate that Madrid was on probation for a conviction for being a felon in possession of firearms and ammunition when he was arrested.
During today’s proceedings, Madrid pled guilty to the indictment without the benefit of a plea agreement. At sentencing, Madrid faces a maximum penalty of ten years in federal prison. He remains in custody pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Las Cruces office of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the New Mexico State Police. Assistant U.S. Attorney Alfred J. Perez of the U.S. Attorney’s Las Cruces Branch Office is prosecuting the case.
Port Orange Pill Mill Doctor Sentenced to More Than Eleven Years in Federal PrisonRead the Press Release
Orlando, Florida – U.S. District Judge Carlos E. Mendoza today sentenced Michael Morgan Dietch (60, Port Orange) to 11 years and 3 months in federal prison for distribution of Schedule II controlled substances outside the usual course of professional practice, without a legitimate medical purpose. He pleaded guilty on October 28, 2016.
According to court documents, Dietch was a licensed physician in Florida who, between June 2011 and August 2012, prescribed Schedule II, III, and IV controlled substances such as oxycodone, hydromorphone, hydrocodone, fentanyl, Morphine, and Methadone to 150 to 200 patients. During this time, he arranged via text message for patients to come to his apartment, where he would provide the prescriptions. Dietch saw as many as 18 patients per day and charged $100 to $150 in cash for an appointment that generally lasted less than 10 minutes.
Many of Dietch’s patients were drug addicts who sold and traded their prescription pills with Dietch’s knowledge. On two occasions, Dietch bonded two of his patients out of a local jail for drug-related charges and then kept them on as patients, writing prescriptions for them for controlled substances. Dietch also wrote prescriptions for some patients who would have them filled but then gave the pills back to him. Dietch would then use some of these pills himself and provide the remaining pills to others.
“This was a fitting sentence for someone who abused his physician’s license to peddle dangerous, deadly, addictive substances without any demonstrated medical need.” said Sheriff Michael Chitwood.
This case was investigated by Drug Enforcement Administration and the Volusia County Sheriff’s Office, in conjunction with the Volusia Bureau of Investigation. It was prosecuted by Assistant United States Attorney Shawn P. Napier.
Pittsburgh Tax Attorney and Owner of Iceoplex Sentenced to Prison for Employment Tax FraudRead the Press Release
A Pittsburgh, Pennsylvania man was sentenced to 48 months in prison today in the U.S. District Court for the Western District of Pennsylvania after being convicted of failing to collect, account for and pay over employment taxes following a jury trial in September 2016, announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division.
According to court documents and the evidence presented at trial, between 2004 and 2015, Steven Lynch, 61, a tax attorney, co-owned and operated the Iceoplex at Southpointe, a recreational sports facility located in Washington County, Pennsylvania. Iceoplex included a fitness center, ice rink, soccer court, restaurant and bar. Lynch controlled the finances for these businesses and was responsible for collecting, accounting for, and paying over tax withheld from employee wages, and timely filing quarterly employment tax returns. The jury found that between 2012 through 2015, Lynch failed to timely pay over to the Internal Revenue Service (IRS) more than $790,000 in taxes withheld from the wages of the employees for these businesses.
“Companies deserve to compete on a level playing field,” said Principal Deputy Assistant Attorney General Ciraolo. “Business owners and operators who choose not to pay over to the United States the taxes that they withheld from their employees’ wages are stealing from the U.S. Treasury and should plan on facing prosecution and incarceration.”
“As the person who controlled the finances on behalf of the different Iceoplex businesses, Steven Lynch, a tax attorney, was entrusted with the significant responsibility to collect and turn over all IRS withholding taxes,” said Special Agent in Charge Akeia Conner of IRS Criminal Investigation (CI). “His failure to pay over the withheld taxes is a violation that IRS Criminal Investigation takes very seriously. Today, justice is served and Mr. Lynch is being held accountable for his criminal actions.”
In addition to the prison term imposed by U.S. District Judge Arthur Schwab, Lynch was ordered to serve three years of supervised release and to pay $793,145 in restitution to the IRS and a $75,000 fine.
Principal Deputy Assistant Attorney General Ciraolo commended the special agents of IRS-CI, who conducted the investigation, and Trial Attorneys Jeffrey Bender and Brittney Campbell of the Tax Division, who prosecuted the case. Principal Deputy Assistant Attorney General Ciraolo also thanked the U.S. Attorney’s Office in the Western District of Pennsylvania for their substantial assistance.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Pittsburgh Tax Attorney and Owner of Iceoplex Sentenced to Prison for Employment Tax FraudRead the Press Release
WASHINGTON – A Pittsburgh, Pennsylvania man was sentenced to 48 months in prison today in the U.S. District Court for the Western District of Pennsylvania after being convicted of failing to collect, account for and pay over employment taxes following a jury trial in September 2016, announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division.
According to court documents and the evidence presented at trial, between 2004 and 2015, Steven Lynch, 61, a tax attorney, co-owned and operated the Iceoplex at Southpointe, a recreational sports facility located in Washington County, Pennsylvania. Iceoplex included a fitness center, ice rink, soccer court, restaurant and bar. Lynch controlled the finances for these businesses and was responsible for collecting, accounting for, and paying over tax withheld from employee wages, and timely filing quarterly employment tax returns. The jury found that between 2012 through 2015, Lynch failed to timely pay over to the Internal Revenue Service (IRS) more than $790,000 in taxes withheld from the wages of the employees for these businesses.
“Companies deserve to compete on a level playing field,” said Principal Deputy Assistant Attorney General Ciraolo. “Business owners and operators who choose not to pay over to the United States the taxes that they withheld from their employees’ wages are stealing from the U.S. Treasury and should plan on facing prosecution and incarceration.”
“As the person who controlled the finances on behalf of the different Iceoplex businesses, Steven Lynch, a tax attorney, was entrusted with the significant responsibility to collect and turn over all IRS withholding taxes,” said Special Agent in Charge Akeia Conner of IRS Criminal Investigation (CI). “His failure to pay over the withheld taxes is a violation that IRS Criminal Investigation takes very seriously. Today, justice is served and Mr. Lynch is being held accountable for his criminal actions.”
In addition to the prison term imposed by U.S. District Judge Arthur Schwab, Lynch was ordered to serve three years of supervised release and to pay $793,145 in restitution to the IRS and a $75,000 fine.
Principal Deputy Assistant Attorney General Ciraolo commended the special agents of IRS-CI, who conducted the investigation, and Trial Attorneys Jeffrey Bender and Brittney Campbell of the Tax Division, who prosecuted the case. Principal Deputy Assistant Attorney General Ciraolo also thanked the U.S. Attorney’s Office in the Western District of Pennsylvania for their substantial assistance.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Physician Sentenced for Illegally Distributing OxycodoneRead the Press Release
PITTSBURGH - A resident of Pittsburgh, has been sentenced in federal court to 5 years of probation, to include eightmonths of home detention, 250 hours community service and fined $50,000 on his conviction of possession with intent to distribute and distribution of Oxycodone, a Schedule II controlled substance, Acting United States Attorney Soo C. Song announced today.
Chief United States District Judge Joy Flowers Conti imposed the sentence yesterday on Dr. Alan Barnett, 69, of Pittsburgh.
According to information presented to the court, Dr. Barnett, a medical doctor, illegally distributed Oxycodone, a controlled substance. On December 1, 2015, Dr. Barnett was interviewed by agents of the Drug Enforcement Administration and Federal Bureau of Investigation and surrendered his Drug Enforcement Administration License.
Assistant United States AttorneyRobert S. Cessar prosecuted this case on behalf of the government.
Acting United States Attorney Song commended the Federal Bureau of Investigation and Drug Enforcement Administration for the investigation leading to the successful prosecution of Barnett.
Philadelphia Man Found Guilty of Defrauding the Federal Supplemental Nutrition Assistance ProgramRead the Press Release
Philadelphia - a federal jury in Philadelphia convicted Abdoulaye Diallo on all counts of an indictment charging him with defrauding the federal Supplemental Nutrition Assistance Program (SNAP), formerly known as the Food Stamp Program, and with conspiring to do so, announced Acting United States Attorney Louis D. Lappen. Diallo owned and operated the Brothers Food Market, a grocery store on Germantown Avenue near Venango Street in Philadelphia. The jury convicted Diallo of conspiring with another individual to buy SNAP benefits for cash from those who had SNAP benefit cards (also known as PA Access cards) between September 2011 and February 2015. The jury also found Diallo guilty of exchanging SNAP benefits for cash on five different dates during that period, each of which constituted wire fraud and SNAP benefit fraud. The amount of money charged to the SNAP Program varied from $300 to almost $600 for each transaction.
The case was tried before United States District Judge Cynthia M. Rufe. Judge Rufe will sentence the defendant at a later date. The court did not set a sentencing date.
Diallo’s convictions were on six counts of wire fraud, six counts of defrauding the SNAP Program, and one count of conspiracy to do so. Diallo faces a maximum sentence of 20 years on each wire fraud count, and five years imprisonment on each SNAP fraud count and on the one conspiracy count. The court could also impose a fine, order forfeiture and order that Diallo pay restitution.
The SNAP Program is administered by the Food and Nutrition Service of the United States Department of Agriculture. It is intended to provide funds to assist low income families in purchasing food.
The case was investigated by the Office of Inspector General, United States Department of Agriculture and by Homeland Security Investigations, with the assistance of the Philadelphia Police Department. The case was tried by Assistant United States Attorneys Floyd J. Miller and Albert S. Glenn.
Philadelphia Man Charged with Bank FraudRead the Press Release
An Indictment[1] was returned today charging Ansu Sanoe, 26, of Philadelphia, Pennsylvania, with 2 counts of bank fraud, announced Acting United States Attorney Louis D. Lappen.
The Indictment alleges that Sanoe and his co-schemers posed as other people using false identification documents, opened up false business bank accounts at TD Bank and Citizens Bank, made deposits of counterfeit checks into those bank accounts, wired funds between the accounts, and withdrew the funds before the banks realized that the checks were fraudulent.
Sanoe faces a maximum sentence of 60 years’ incarceration, a five-year period of supervised release, a fine of $2,000,000, and restitution of at least $125,000.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Michael S. Lowe.
[1] An Indictment or Information is an accusation. A defendant is presumed innocent unless and until proven guilty
Orlando Man Convicted of Credit Card FraudRead the Press Release
Orlando, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury has found Akeitha Mumtaz Warner (29, Orlando) guilty of possessing 15 or more counterfeit access devices (credit cards) with the intent to defraud. He faces a maximum penalty of 10 years in federal prison. His sentencing hearing is scheduled for April 3, 2017. Warner and his co-defendant, Ricardo Delgado-George (29, Kissimmee), were indicted on October 12, 2016. Delgado-George pleaded guilty to fraud-related charges on December 19, 2016, and is scheduled to be sentenced on March 13, 2017.
According to court documents and evidence presented at trial, Warner and Delgado-George were stopped by an Osceola County Sheriff’s deputy and found to be in possession of more than 100 counterfeit credit and debit cards, hundreds of account numbers, and equipment that could be used to re-encode cards. Both men admitted to using counterfeit cards at various central Florida stores and gas stations.
This case was investigated by the United States Secret Service and the Osceola County Sheriff’s Office. It is being prosecuted by Assistant United States Attorney Embry J. Kidd.
New Orleans Man Sentenced for Heroin DistributionRead the Press Release
U.S. Attorney Kenneth A. Polite announced that DELRONE MOORE, age 39, of New Orleans, was sentenced today after previously pleading guilty to two counts of distribution of heroin.
U.S. District Judge Nannette Jolivette Brown sentenced MOORE to serve 45 months imprisonment to be followed by 3 years of supervised release.
According to court documents, in the fall of 2015, a Jefferson Parish Sheriff’s Office detective conducted controlled undercover purchases of heroin from MOORE. On October 14, 2015, the undercover detective met with MOORE in Kenner, buying approximately half of an ounce of heroin from MOORE. On November 12, 2015, the undercover detective again met with MOORE in Kenner and conducted a second controlled undercover purchase, buying approximately one ounce of heroin from MOORE. Both of the hand-to-hand transactions took place in the undercover detective’s vehicle and were captured on that vehicle’s audio and video recording system.
U.S. Attorney Polite praised the work of the Drug Enforcement Administration and the Jefferson Parish Sheriff’s Office. Assistant United States Attorney Nicholas D. Moses was in charge of the prosecution.
New Orleans Man Indicted on Murder, Carjacking, Robbery, Drug and Firearms ChargesRead the Press Release
U.S. Attorney Kenneth A. Polite announced that KWAME FLEMING, age 26, of New Orleans, was indicted today for charges of committing murder through use of a firearm, conspiracy to commit carjackings, conspiracy to commit Hobbs Act robbery, conspiracy to distribute and possess with intent to distribute marijuana, brandishing and discharging firearms during crimes of violence, and other offenses.
According to the Indictment, FLEMING and others known to the Grand Jury conspired to distribute and possess with intent to distribute marijuana. In furtherance of that conspiracy, FLEMING and others murdered Jacquez Young in Gretna, Louisiana, on June 1, 2015.
FLEMING is also charged with conspiring to commit carjackings, and for brandishing firearms during those carjackings. The Indictment outlines four separate carjackings or attempted carjackings that FLEMING or his co-conspirators committed. First, on May 31, 2015, FLEMING’s co-conspirators carjacked a 2015 white Dodge Ram in New Orleans. The next day, on June 1, 2015, FLEMING and his co-conspirators attempted to carjack a 2013 gold Ford F-250 in New Orleans, but were unsuccessful. Shortly after that, on the same day, FLEMING and his co-conspirators successfully carjacked a 2014 Chevrolet Cruze in New Orleans. On June 4, 2015, FLEMING and his co-conspirators carjacked a 2004 GMC Yukon in Baton Rouge, Louisiana, which they drove back to New Orleans. FLEMING is also charged separately for his participation in three of the carjackings or attempted carjackings.
FLEMING is also charged with committing a Hobbs Act robbery on June 4, 2015, and for discharging a firearm during that robbery. According to the Indictment, FLEMING and his co-conspirators, while in the New Orleans area, arranged to steal a quantity of marijuana and synthetic marijuana from a person through the use of actual and threatened violence, which later occurred in Mississippi.
If convicted of murder through use of a firearm, FLEMING faces a maximum sentence of life imprisonment. If convicted of carjacking or attempted carjacking, FLEMING faces a maximum sentence of 15 years imprisonment on each count. If convicted of brandishing a firearm during a crime of violence, FLEMING faces a minimum of 7 years to a maximum of life imprisonment on each count. If convicted of Hobbs Act robbery, FLEMING faces a maximum sentence of 20 years imprisonment. If convicted of discharging a firearm during a crime of violence, he faces a minimum of 10 years to a maximum of life imprisonment. If convicted of conspiracy to distribute and possess with intent to distribute marijuana, FLEMING faces a maximum sentence of 5 years imprisonment. If convicted of conspiracy to commit carjackings, he faces a maximum sentence of 5 years imprisonment. If convicted of conspiracy to use firearms during drug trafficking and crimes of violence, he faces a maximum sentence of 20 years imprisonment.
U.S. Attorney Polite reiterated that the Indictment is merely an allegation and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Jefferson Parish District Attorney’s Office, the Jefferson Parish Sheriff’s Office, the Zachary Police Department, and the Wilkinson County Sheriff’s Office for investigating this matter. Assistant United States Attorney Jonathan L. Shih and Trial Attorney Joseph K. Wheatley from the Department of Justice are in charge of the prosecution.
Navy’s “Supply Officer of the Year” Sentenced to 30 months in Expanding Bribery and Fraud InvestigationRead the Press Release
Assistant U.S. Attorneys Mark W. Pletcher (619) 546-9714 and Patrick Hovakimian (619) 546-9718
NEWS RELEASE SUMMARY – January 12, 2017
SAN DIEGO – U.S. Navy Lieutenant Commander Gentry Debord, who was named U.S. Navy Supply Officer of the Year while he was secretly accepting bribes and prostitutes from a foreign defense contractor in exchange for confidential information, was sentenced in federal court today to 30 months in prison.
Debord, 41, who pleaded guilty in October 2016 to a bribery charge, was also ordered to pay a $15,000 fine and $37,000 in restitution to the Navy. Debord has admitted that he accepted cash, luxury hotels and prostitutes from foreign defense contractor Leonard Glenn Francis between 2007 and 2013. In return he provided proprietary Navy information that benefitted Francis’ company, Singapore-based Glenn Defense Marine Asia.
During today’s hearing, U.S. District Judge Janis L. Sammartino told the defendant that he picked the wrong side. “You were clearly on their team and not the Navy’s team.”
Acting U.S. Attorney Alana Robinson said: “This is a fitting sentence for a man who sullied his stripes with such despicable behavior. We will continue to move forward in this investigation until all involved are held accountable.”
According to his plea agreement, from November 2007 to January 2013, Debord provided Francis and others with internal, proprietary U.S. Navy information; directed Francis and GDMA to inflate invoices to reflect services not rendered; advocated for the U.S. Navy to procure items from GDMA under its husbanding contracts; and otherwise used his position and influence in the U.S. Navy to advocate for and advance GDMA’s interests, as opportunities arose.
During the conspiracy, Debord was a supply officer aboard the U.S.S. Essex and later became a logistics officer for the Pacific Fleet. As a supply officer, Debord was responsible for procuring goods and services to meet the ship’s logistical and supply needs and for confirming that the U.S. Navy’s contractors provided these services. As logistics officer, he helped direct ship movements and port visits in the Western Pacific region.
As part of this conspiracy, Debord, Francis and others attempted to conceal the nature and extent of their relationship, by, among other things, using fictitious email accounts to communicate and using coded language and other means designed to obfuscate the true nature of their corrupt relationship, including referring to prostitutes as “cheesecakes” and “bodyguards.”
For example, on or about February 26, 2008, Debord emailed a GDMA executive to ask him to provide the services of prostitutes during the U.S.S. Essex’s upcoming port visit to Manila, Philippines: “[D]ouble checking to see if I will have my security for the 2nd and the 4th. I however do not want anyone to know I have a bodyguard.” The executive responded: “Bodyguards are standing by.”
About eight months later, around October 30, 2008, Debord emailed GDMA executives advising them that the U.S. Navy’s ship husbanding contract in the Philippines was “coming up for renew[al],” and asking that GDMA provide him with an apartment in conjunction with an upcoming port visit by the U.S.S. Essex to Hong Kong. Debord noted that he and another GDMA employee “had fun up [near Clark Air Force Base,] ate lots of cheesecake, even ate some in a group session.”
From May 2010 until December 2011, Debord was specially selected to attend the Naval Postgraduate School in Monterey, California, during which time he was not in direct contact with GDMA.
In December 2011, however, Debord accepted a position in Singapore, putting him again in close proximity to GDMA. On or about May 26, 2012, after recognizing Debord’s name on an email chain regarding fuel issues, GDMA’s Vice President of Global Operations Neil Peterson executive emailed another GDMA employee, “Look at who's the replenishment officer for ctf73, you remember sex crazy LT Debord from Essex!” Peterson emailed Debord on May 28, 2012 and invited him out for “cheesecake…just like the good ol days.”
So far, a total of 16 named individual defendants have been charged in connection with the GDMA corruption and fraud investigation. Of those, 11 are current or former U.S. Navy officials, including Debord, Admiral Robert Gilbeau, believed to be the first active-duty U.S. Navy flag officer charged in a federal criminal case; Captain (ret.) Michael Brooks; Commander Bobby Pitts; Captain Daniel Dusek; Commander Michael Misiewicz; Lt. Commander Todd Malaki; Commander Jose Luis Sanchez; Petty Officer First Class Daniel Layug; Naval Criminal Investigative Service Supervisory Special Agent John Beliveau; and Paul Simpkins, a former DoD civilian employee, who oversaw contracting in Singapore.
Debord, Brooks, Gilbeau, Dusek, Misiewicz, Malaki, Beliveau, Sanchez, Layug, and Simpkins have pleaded guilty. On Jan. 21, 2016, Layug was sentenced to 27 months in prison and a $15,000 fine; on Jan. 29, 2016, Malaki was sentenced to 40 months in prison and to pay $15,000 in restitution to the Navy and a $15,000 fine. On March 25, 2016, Dusek was sentenced to 46 months in prison and to pay $30,000 in restitution to the Navy and a $70,000 fine; and on April 29, 2016, Misiewicz was sentenced to 78 months in prison and to pay a fine of $100,000 and to pay $95,000 in restitution to the Navy. Beliveau was sentenced on October 14, 2016 to 12 years in prison and to pay $20 million in restitution; Simpkins was sentenced on December 2, 2016 to 72 months in prison; Brooks, Gilbeau and Sanchez await sentencing.
Pitts were charged in May 2016 and his case are pending.
Also charged are five GDMA executives – Francis, Alex Wisidagama, Ed Aruffo and Neil Peterson and Linda Raja. Three have pleaded guilty; Wisidagama was sentenced on March 18, 2016 to 63 months and $34.8 million in restitution to the Navy. Francis and Aruffo await sentencing; Peterson and Raja were extradited from Singapore in September 2016 and their cases are pending.
In the government’s sentencing memorandum, Assistant U.S. Attorney Mark Pletcher wrote that Debord’s conduct was particularly galling considering he received a prestigious award while he was in cahoots with Francis. “Ultimately, that Debord was effectively working for GDMA and against the U.S. Navy in dereliction of his official duties at the same time as being awarded the Supply Officer of the Year Award is an unparalleled example of duplicity, even considering the high bar set by the industrious cast of defendants in this investigation.”
The Defense Criminal Investigative Service, Naval Criminal Investigative Service, and the Defense Contract Audit Agency are investigating. Assistant U.S. Attorneys Mark W. Pletcher and Patrick Hovakimian of the Southern District of California and Assistant Chief Brian R. Young of the Criminal Division’s Fraud Section are prosecuting the case.
Anyone with information relating to fraud or corruption should contact the NCIS anonymous tip line at www.ncis.navy.mil or the DOD Hotline at www.dodig.mil/hotline, or call (800) 424-9098.
DEFENDANT Case Number: 16cr1457-JLS
Lieutenant Commander Gentry Debord Age 41 San Diego
SUMMARY OF CHARGES
Conspiracy to Commit Bribery, in violation of 18 U.S.C. § 371
Maximum Penalty: 5 years in prison, a $250,000 fine,
INVESTIGATING AGENCIES
Defense Criminal Investigative Service
Naval Criminal Investigative Service
Defense Contract Audit Agency
Navy Officer Sentenced to 30 Months in Expanding Bribery and Fraud InvestigationRead the Press Release
A U.S. Navy Lieutenant Commander was sentenced today to 30 months in prison for accepting cash, hotel expenses and the services of a prostitute from foreign defense contractor Glenn Defense Marine Asia (GDMA) in exchange for classified Navy information.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Alana Robinson of the Southern District of California, Director Dermot O’Reilly of the Department of Defense’s (DoD) Defense Criminal Investigative Service (DCIS) and Director Andrew Traver of the Naval Criminal Investigative Service (NCIS) made the announcement.
In October 2016, Gentry Debord, 41, pleaded guilty to one count of conspiracy to commit bribery and admitted that in 2007 he began a corrupt relationship with Leonard Glenn Francis, the former president and CEO of GDMA, a company that provided port services to U.S. Navy ships and submarines throughout the Pacific. In addition to his prison sentence, U.S. District Judge Janis L. Sammartino of the Southern District of California ordered Debord to pay a $15,000 fine and $37,000 in restitution to the Navy.
As part of the scheme, between 2007 and 2013, Debord accepted cash, luxury hotels and the services of prostitutes from Francis in exchange for proprietary Navy information that benefitted GDMA. During this period, Debord served as a supply officer aboard the U.S.S. Essex and later as a logistics officer for the Pacific Fleet. Debord further admitted that he provided Francis and others with internal, proprietary U.S. Navy information; directed Francis and GDMA to inflate invoices to reflect services not rendered; advocated for the U.S. Navy to procure items from GDMA under its husbanding contracts; and otherwise used his position and influence in the U.S. Navy to advocate for and advance GDMA’s interests.
To date, a total of 16 individuals have been charged in connection with the scheme; of those, 10 have pleaded guilty, including Debord, Admiral Robert Gilead, Captain Michael Brooks, Commander Bobby Pitts, Captain Daniel Dusk, Commander Michael Mickiewicz, Lt. Commander Todd Malaki, Commander Jose Luis Sanchez and U.S. Petty Officer First Class Daniel Layup.
On Jan. 21, 2016, Layup was sentenced to 27 months in prison and a $15,000 fine; on Jan. 29, 2016, Malaki was sentenced to 40 months in prison and to pay $15,000 in restitution to the Navy and a $15,000 fine. On March 25, 2016, Dusk was sentenced to 46 months in prison and to pay $30,000 in restitution to the Navy and a $70,000 fine; and on April 29, 2016, Mickiewicz was sentenced to 78 months in prison and to pay a fine of $100,000 and to pay $95,000 in restitution to the Navy. Beliveau was sentenced on Oct. 14, 2016, to 12 years in prison and to pay $20 million in restitution; Simpkins was sentenced on Dec. 2, 2016, to 72 months in prison; Brooks, Gilbeau and Sanchez await sentencing. Pitts was charged in May 2016 and his case is pending.
DCIS, NCIS and the Defense Contract Audit Agency are investigating the case. Assistant Chief Brian R. Young of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Mark W. Pletcher and Patrick Hovakimian of the Southern District of California are prosecuting the case.Minneapolis Man Sentenced to 195 Months in Prison for Drug Distribution and Unlawful Possession of FirearmsRead the Press Release
United States Attorney Andrew M. Luger announced the sentencing of EUGENE RYAN BOOS, 44, to 195 months in prison after pleading guilty on August 15, 2016, to conspiracy to distribute methamphetamine and possession of a firearm in furtherance of a drug-trafficking crime. BOOS was sentenced before Senior U.S. District Judge David S. Doty in U.S. District Court in Minneapolis, Minn.
“Eugene Boos is a dangerous, repeat offender,” said James Modzelewski, Bureau of Alcohol, Tobacco, Firearms and Explosives Special Agent in Charge. “Getting him off the streets is critical to keeping our communities safe. I want to commend the Hennepin and Anoka County Sheriff’s Offices for their contributions in this case. ATF will continue to partner with all Minnesota law enforcement to reduce gun-related violent crimes.”
According to BOOS’ guilty plea and documents filed in court, on December 10, 2014, while BOOS was on felony supervised release from the Minnesota Department of Corrections for a 1994 second-degree murder conviction, officers with the Hennepin County Sheriff’s Office seized from the defendant’s home three firearms, ammunition, 132.5 grams of highly pure methamphetamine, digital scales, packaging materials, over 100 controlled substance pills, and more than $12,000 hidden in a speaker.
According to the defendant’s guilty plea and documents filed in court, in addition to the aforementioned contraband, BOOS possessed additional quantities of methamphetamine and materials commonly used to manufacture methamphetamine in the garage of the residence. In fact, the strong chemical odor of ammonia emanating from the garage was so overwhelming that officers summoned a haz-mat cleanup team to respond to the residence and properly dispose of the hazardous chemicals.
According to the defendant’s guilty plea and documents filed in court, among the firearms that BOOS illegally possessed were a .380-caliber semi-automatic handgun with an obliterated serial number and a stolen .45 caliber semi-automatic pistol.
The case was prosecuted by Assistant United States Benjamin Bejar and was the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, in collaboration with the Anoka County Sheriff’s Office and the Hennepin County Sheriff’s Office.
Defendant Information:EUGENE RYAN BOOS, 44
Minneapolis, Minn.Convicted:
• Possession with intent to distribute methamphetamine, 1 count
• Possession of firearms in furtherance of a drug-trafficking crime, 1 countSentenced:
• 195 months in prison
• Supervised release for a term of five yearsMexico Man Sentenced for Meth TraffickingRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Mexico, Mo., man was sentenced in federal court today for possessing methamphetamine with the intent to distribute.
Robby Dee Kesler, 54, of Mexico, Mo., was sentenced by U.S. District Judge Brian C. Wimes to 11 years and five months in federal prison without parole.
On July 19, 2016, Kesler pleaded guilty to possessing methamphetamine with the intent to distribute.
MUSTANG Task Force officers, aware that Kesler had outstanding warrants, were investigating Kesler and had him under surveillance on May 21, 2015. Kesler drove to a residence in Columbia, Mo. When a Missouri State Highway Patrol trooper approached Kesler, he got out of his vehicle and went into the residence. The residents of the home told the trooper that Kesler had entered without their consent and was hiding in the bathroom. Officers set up a perimeter around the residence, and after several hours were able to make contact. After a period of negotiations, Kesler surrendered to officers.
When taken into custody, Kesler had $1,759 in his wallet. Officers also found a large Zip-loc bag that contained approximately 370 grams of methamphetamine concealed in a canvas bag behind the driver’s seat of his car. Officers also found an additional $9,000 inside the residence.
On May 26, 2015, a search was conducted at Kesler’s mother’s residence in Mexico, Mo., where Kesler was living at the time. Officers recovered drug paraphernalia and a Walther PPK pistol.
According to court documents, Callaway County Sheriff’s deputies had conducted a search warrant at Kesler’s residence on Aug. 25, 2013. Officers recovered a number of items consistent with drug distribution, including digital scales, five grams of methamphetamine, and $16,460 in U.S. currency from his bedroom.
On Jan. 20, 2014, Kesler and two other individuals were in a vehicle that was stopped by officers. The officers recovered drug paraphernalia, bags containing suspected methamphetamine, and $20,169 from the vehicle. Officers conducted a search of Kesler’s residence in Fulton, Mo., the same day, and recovered numerous items of drug paraphernalia, a plastic bag containing suspected methamphetamine, a shotgun and $1,650. According to court documents, the residence was equipped with surveillance cameras.
This case was prosecuted by Assistant U.S. Attorney Jim Lynn. It was investigated by the Missouri State Highway Patrol, the Bureau of Alcohol, Tobacco, Firearms and Explosives and MUSTANG (the Mid-Missouri Unified Strike Team and Narcotics Group).
Man Charged with Enticing Missing Teen for Illicit SexRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a man arrested near Kansas City, Mo., has been charged in federal court with attempting to entice a missing Springfield, Mo., teen to engage in illicit sexual activity.
Dominic Keith Pearson, 25, no known address, was charged in a federal criminal complaint filed in the U.S. District Court in Springfield, Mo., on Wednesday, Jan. 11, 2017. Pearson, who was arrested on Tuesday, Jan. 10, 2017, in Jackson County, Mo., had his initial court appearance this afternoon in the U.S. District in Kansas City, Mo., and remains in federal custody pending a detention hearing.
According to an affidavit filed in support of the federal criminal complaint, the 13-year-old child victim – identified in court documents as “Jane Doe” – was reported missing from her home in Springfield on Jan. 8, 2017. Investigators found a series of messages between Pearson and Jane Doe on a cell phone, the affidavit says, indicating that Pearson was traveling to meet Jane Doe.
On Jan. 10, 2017, Pearson and Jane Doe were located in a truckers lounge at Petro Truck Stop off Interstate 70 near Oak Grove, Mo. Both Pearson and Jane Doe had luggage with them in the lounge.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Ami Harshad Miller. It was investigated by the Springfield, Mo., Police Department, the FBI, the Southwest Missouri Cyber Crimes Task Force and the Oak Grove, Mo., Police Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Louisiana Man Pleads Guilty to Conspiracy to Sell Devices to Cheat Vehicle Emissions TestsRead the Press Release
SYRACUSE, NEW YORK – Charles Edward Bayer, Jr. (31), of Lafayette, Louisiana, pled guilty in federal court today in Syracuse to one felony count of conspiracy to commit mail fraud and violate the Clean Air Act, announced United States Attorney Richard S. Hartunian, and Vernesa Jones-Allen, Special Agent in Charge, EPA-CID, New York Area Office.
In pleading guilty, Bayer admitted that between 2011 and 2013 he participated in a conspiracy to design, manufacture, and sell motor vehicle simulator devices which were designed and programmed to allow vehicles to by-pass motor vehicle emissions inspections tests in a fraudulent manner. Bayer admitted that when one of his co-conspirators believed the EPA had become aware of the illegal sales of these devices, he (Bayer) purchased the remaining inventory as well as the source codes, and a customer list. Thereafter Bayer continued to sell and manufacture these devices. Ultimately, Bayer and his co-conspirators sold at least 170 such devices throughout the country. In pleading guilty, Bayer admitted that he was a leader in the conspiracy, which involved at least five others. Bayer also admitted that he understood his customers were using the devices to fraudulently bypass motor vehicle inspections and that he added a disclaimer to the instructions that the devices were for “development/off road use only” to make the devices appear legitimate.
The charge to which Bayer pled guilty carries a maximum sentence of 5 years in prison and a fine of up to $250,000. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors. Bayer will be sentenced by Senior District Judge Norman A. Mordue on May 11, 2017.
This case is being investigated by EPA-CID, the New York State Department of Environmental Conservation, and it is being prosecuted by Assistant U.S. Attorney Michael F. Perry and Senior Trial Attorney Todd Gleason.
Las Cruces Man Pleads Guilty to Federal Methamphetamine Trafficking ChargesRead the Press Release
ALBUQUERQUE – Anthony Margarito Berumen, 32, of Las Cruces, N.M., pled guilty today in federal court to methamphetamine trafficking charges. Under the terms of his plea agreement, Berumen will be sentenced within the range of three to ten years in federal prison.
Berumen was arrested on Feb. 9, 2016, on a criminal complaint charging him with possession of methamphetamine with intent to distribute on Dec. 9, 2015 and Dec. 15, 2015. The complaint alleged that Berumen committed the crimes in Dona Ana County, N.M. According to the complaint, Berumen sold a total of 4.6 grams of methamphetamine to undercover law enforcement agents during two transactions on Dec. 9, 2015, and one transaction on Dec. 15, 2015.
Berumen was indicted on Aug. 17, 2016, and charged with three counts of distributing methamphetamine. The indictment was superseded on Sept. 22, 2016, charging Berumen with distributing methamphetamine on Dec. 9, 2015 and Dec. 16, 2015, and distributing methamphetamine in the vicinity of a school on Dec. 9, 2015.
During today’s proceedings, Berumen pled guilty to the superseding indictment. In entering the guilty plea, Berumen admitted selling methamphetamine to undercover law enforcement on three occasions in Dec. 2015. He also acknowledged that the one of the drug transactions took place in a middle school parking lot in Las Cruces. Berumen remains in custody pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Las Cruces office of the FBI and the New Mexico State Police and is being prosecuted by Assistant U.S. Attorneys John Balla and Sarah M. Davenport of the U.S. Attorney’s Las Cruces Branch Office.
KC Man Indicted for Attempted Sex Trafficking of MinorRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., man was indicted by a federal grand jury today for the attempted sex trafficking of a minor.
Andrew Danny Freeman, 32, of Kansas City, was charged in an indictment returned by a federal grand jury in Kansas City, Mo. Today’s indictment replaces a criminal complaint that was filed against Freeman on Dec. 16, 2016. Freeman remains in federal custody without bond.
The federal indictment alleges that Freeman solicited a person he believed to be under the age of 18 to engage in prostitution on Dec. 15, 2016.
According to an affidavit filed in support of the original criminal complaint, an undercover officer received a series of text messages from Freeman on Dec. 15, 2016, in response to an online posting that was part of an undercover prostitution operation. Freeman allegedly made arrangements to meet the undercover officer and whom he believed to be her 12-year-old daughter at a local hotel. When he arrived for the meeting, the affidavit says, he gave the undercover officer $500 and was arrested.
Dickinson cautioned that the charge contained in this indictment is simply an accusation, and not evidence of guilt. Evidence supporting the charge must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Patrick D. Daly. It was investigated by the FBI and the Human Trafficking Rescue Project.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
KC Daycare Center owner, Director Indicted for $556,000 Fraud SchemeRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that the owner and the director of a Kansas City, Mo., day care center were indicted by a federal grand jury today for their roles in a conspiracy to file false attendance reports in order to fraudulently receive as much as $556,000 in federal benefits.
Today’s indictment is the result of a nationwide sweep that targeted childcare center fraud schemes. The national law enforcement operation in Missouri and six other states was the result of separate, but related, federal investigations into childcare center fraud that resulted in a loss of more than $1 million to the government.
Sharif Karie, 39, of Olathe, Kan., and Sheri Beamon, 46, of Kansas City, Mo., were charged in an eight-count indictment returned by a federal grand jury in Kansas City, Mo. Karie, a naturalized U.S. citizen from Somalia, is the owner and CEO of a day care center established under two businesses and two names for the same location, with the same key employees: KARIE Day Care Center, LLC, and Tima Child Care Center, LLC, at 1019 Admiral Blvd., Kansas City, Mo. Beamon is the director of KARIE/Tima Childcare Center.
Today’s indictment alleges that Karie and Beamon participated in a conspiracy from October 2013 to June 2016 to submit false claims to the government. They allegedly billed a federal grant program to provide childcare services to low-income families for more hours and children than actually attended the daycare center. At least $100,000 and as much as $556,000 was fraudulently billed in connection with this scheme, the indictment says.
The Child Care and Development Fund provides daycare subsidies for low-income families where the parents are employed or engaged in job training. Providers contract with the Children’s Division of the Missouri Department of Health and Senior Services and submit claims electronically.
According to today’s indictment, pole cameras were installed near the day care center and captured footage of the entrances and exits of the building during two time periods in 2015 and in 2016. Timesheets and billing records were reviewed and compared to the children seen on the pole cameras being dropped off and picked up from the daycare center during that time. There were significant discrepancies, the indictment says, between the timesheets, claims submitted and the pole camera footage.
In addition to the conspiracy, Karie and Beamon are charged together in one count of theft of public money, three counts of aiding and abetting each other to commit aggravated identity theft and three counts of wire fraud. Today’s indictment also contains a forfeiture allegation, which would require Karie and Beamon to forfeit to the government any property derived from the proceeds of the alleged scheme, including at least $100,000 and as much as $556,000.
According to the indictment, the state conducted a compliance review of the daycare center’s billing for May 2014 and July 2014. The review found several attendance records missing. The review also identified 14 out of the 15 families with children at the center who had a parent employed there. With only two classrooms, the indictment says, it is improbable that parents were not caring for their own children. One of these parents reported that her job was contingent on having all of her children placed in care at KARIE Day Care Center so her child care would be paid by the state. This same 2014 audit found several discrepancies on the time sheets submitted to the state.
Subsequent unannounced inspections at KARIE Day Care Center found the facility in violation of state regulations pertaining to child care licensing rules, the indictment says, including health and safety, staff ratios and the maintaining of attendance records. Each of the inspections resulted in violation findings.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Jane Pansing Brown. It was investigated by the U.S. Department of Health and Human Services – Office of Inspector General, Office of Investigations, the FBI, the Missouri Department of Social Services – Division of Legal Services Investigations and the Kansas City, Mo., Police Department.
Justice Department Settles Pregnancy Discrimination Lawsuit Against Palm Beach County, Florida, School BoardRead the Press Release
The Justice Department today filed a proposed consent decree with the Palm Beach County, Florida, School Board to resolve a pregnancy discrimination lawsuit brought by the department under Title VII of the Civil Rights Act of 1964.
According to the department’s complaint, the board discriminated on the basis of sex against Assistant Principal Anne Williams Dorsey of the Palm Beach County School District by unlawfully demoting her. The department alleges that after Dorsey became pregnant, her supervisor reassigned her to a position with less pay and benefits and filled her former position by replacing her with a male colleague she had trained. The department further alleges that Dorsey’s demotion was also unlawful retaliation against her for her efforts to report sexual harassment allegations, made by a third employee, against the male colleague who replaced her in her former position.
Under the consent decree, which still must be approved by the U.S. District Court for the Southern District of Florida, the board has agreed to pay $350,000 in back pay and compensatory damages to Dorsey. In addition, the board must review and revise its anti-discrimination policies and procedures to ensure that it protects its employees from discrimination on the basis of sex, including pregnancy, and unlawful retaliation. The board must also provide training to its employees on its anti-discrimination policies and procedures.
“No woman should face discrimination for her decision to have a family,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “Women like Anne Williams Dorsey deserve the full enforcement of this nation’s employment discrimination laws, which ensure that they do not lose valuable positions, pay or benefits because of their pregnancies.”
“The U.S. Attorney’s Office is committed to preventing pregnancy discrimination and ensuring workplace equity,” said U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida. “A woman should never have to choose between having a family and pursuing her professional career. We are pleased that the Palm Beach County School Board has agreed to review its policies and procedures to ensure that it promotes a professional environment that is fully compliant with Title VII. Our Office will continue to enforce the right of pregnant employees to be free from employment discrimination and retaliation.”
Title VII is a federal statute which prohibits employment discrimination on the basis of sex (including pregnancy), race, color, national origin or religion. Title VII also prohibits retaliation against an employee who opposes an unlawful employment practice, makes a charge of discrimination or participates in an investigation, proceeding or hearing under the Civil Rights Act.
Dorsey initially filed charges of sex discrimination and retaliation with the Equal Employment Opportunity Commission’s Miami Field Office, which investigated the matter, determined there was reasonable cause to believe discrimination had occurred and referred the matter to the Justice Department.
The case is being handled by Trial Attorneys Nadia Said and Louis Whitsett of the Civil Rights Division’s Employment Litigation Section and Assistant U.S. Attorney Veronica Harrell-James of the Southern District of Florida
The continued enforcement of Title VII is a priority of the Justice Department’s Civil Rights Division. Additional information about Title VII and other federal employment laws is available on the Civil Rights Division’s website at www.justice.gov/crt.
Justice Department Settles Pregnancy Discrimination Lawsuit Against Palm Beach County, Florida, School BoardRead the Press Release
According to the department’s complaint, the board discriminated on the basis of sex against Assistant Principal Anne Williams Dorsey of the Palm Beach County School District by unlawfully demoting her. The department alleges that after Dorsey became pregnant, her supervisor reassigned her to a position with less pay and benefits and filled her former position by replacing her with a male colleague she had trained. The department further alleges that Dorsey’s demotion was also unlawful retaliation against her for her efforts to report sexual harassment allegations, made by a third employee, against the male colleague who replaced her in her former position.
Under the consent decree, which still must be approved by the U.S. District Court for the Southern District of Florida, the board has agreed to pay $350,000 in back pay and compensatory damages to Dorsey. In addition, the board must review and revise its anti-discrimination policies and procedures to ensure that it protects its employees from discrimination on the basis of sex, including pregnancy, and unlawful retaliation. The board must also provide training to its employees on its anti-discrimination policies and procedures.
“The U.S. Attorney’s Office is committed to preventing pregnancy discrimination and ensuring workplace equity,” said U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida. “A woman should never have to choose between having a family and pursuing her professional career. We are pleased that the Palm Beach County School Board has agreed to review its policies and procedures to ensure that it promotes a professional environment that is fully compliant with Title VII. Our Office will continue to enforce the right of pregnant employees to be free from employment discrimination and retaliation.”
“No woman should face discrimination for her decision to have a family,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “Women like Anne Williams Dorsey deserve the full enforcement of this nation’s employment discrimination laws, which ensure that they do not lose valuable positions, pay or benefits because of their pregnancies.”
Title VII is a federal statute which prohibits employment discrimination on the basis of sex (including pregnancy), race, color, national origin or religion. Title VII also prohibits retaliation against an employee who opposes an unlawful employment practice, makes a charge of discrimination or participates in an investigation, proceeding or hearing under the Civil Rights Act.
Dorsey initially filed charges of sex discrimination and retaliation with the Equal Employment Opportunity Commission’s Miami Field Office, which investigated the matter, determined there was reasonable cause to believe discrimination had occurred and referred the matter to the Justice Department.
The case is being handled by Assistant U.S. Attorney Veronica Harrell-James of the Southern District of Florida and Trial Attorneys Nadia Said and Louis Whitsett of the Civil Rights Division’s Employment Litigation Section.
The continued enforcement of Title VII is a priority of the Justice Department’s Civil Rights Division. Additional information about Title VII and other federal employment laws is available on the Civil Rights Division’s website at www.justice.gov/crt.
Justice Department Seeks to Intervene in Lawsuit Against New York City Board of ElectionsRead the Press Release
The Justice Department announced today that it has filed a motion to intervene in Common Cause New York et al. v. Board of Elections in the City of New York et al, a private lawsuit alleging that the New York City Board of Elections failed to comply with Section 8 of the National Voter Registration Act of 1993 (NVRA). The lawsuit was filed by private plaintiffs on Nov. 3, 2016.
The department alleges that the New York City Board of Elections’ Brooklyn Borough Office violated the NVRA by improperly removing more than 117,000 registered voters from the voter registration rolls prior to the April 2016 primary election. According to the complaint in intervention, the Board of Elections purged these voters based solely on their failure to vote in past elections, which violates Section 8(b)(2) of the NVRA.
The department also alleges ongoing concerns with the oversight of voter list maintenance procedures by the New York City Board of Elections, in violation of federal law. Without intervention, these deficiencies could lead to the same or similar NVRA violations occurring again in the future.
“Federal law demands careful maintenance of the voter rolls to ensure lists are kept accurate, without unjustifiably and unlawfully purging eligible citizens,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “The department appreciates the continued cooperation of the New York City Board of Elections, including proactive steps taken to start remedying violations that have occurred – but more is necessary to reach full compliance with the law.”
“The right of citizens to vote is a critical part of democratic process,” said U.S. Attorney Robert L. Capers of the Eastern District of New York. “We will work tirelessly to ensure that, in the future, the New York City Board of Elections fulfills its statutory obligation to maintain the rolls properly, and provide appropriate notice to voters when it does so.”
Section 8 of the NVRA addresses voter registration list maintenance procedures in elections for federal office. Programs to maintain accurate and current voter registration lists must be uniform, nondiscriminatory and in compliance with the Voting Rights Act of 1965. Moreover, programs to maintain accurate and current voter registration lists may not remove voters solely by reason of a voter’s failure to vote.
More information about the NVRA and other federal voting laws is available on the division’s website at www.justice.gov/crt/voting. Complaints about voter registration practices may be reported to the Civil Rights Division’s Voting Section at 1-800-253-3931.
Brooklyn BOE Complaint in InterventionJustice Department Reaches Agreement with City of Baltimore to Reform Police Department’s Unconstitutional PracticesRead the Press Release
The Justice Department announced today that it has entered into a court enforceable agreement with the city of Baltimore to resolve the department’s findings that the Baltimore City Police Department (BPD) engages in a pattern and practice of conduct that violates the First, Fourth and 14th Amendments of the Constitution as well as federal anti-discrimination laws.
The consent decree, filed today in the U.S. District Court for the District of Maryland, creates a pathway toward lasting reform within BPD. The decree’s requirements focus on building community trust, creating a culture of community and problem-oriented policing, prohibiting unlawful stops and arrests, preventing discriminatory policing and excessive force, ensuring public and officer safety, enhancing officer accountability and making needed technological upgrades. Under the agreement, the parties will jointly recommend an independent monitor to the court to assess whether the requirements of the agreement are being implemented. The independent monitor will report publicly on BPD’s implementation efforts on a regular basis. In the joint motion filing the decree, the parties requested that the court provide an opportunity for members of the public and stakeholders throughout Baltimore to provide written submissions to the court about the proposed decree, and then hold a public hearing.
“Last August, we concluded that the Baltimore Police Department had engaged in conduct that deprived the people of Baltimore of the rights and protections guaranteed to every American, and that the deeply-rooted mistrust between law enforcement officers and the community they serve harmed all who call Baltimore home,” said Attorney General Loretta E. Lynch. “After thorough, good-faith negotiations, the Department of Justice and the city of Baltimore have agreed to enter into a court-enforceable consent decree to remedy the violations identified in our investigation. The reforms in this consent decree will help ensure effective and constitutional policing, restore the community’s trust in law enforcement, and advance public and officer safety. We could not be prouder to partner with the people of Baltimore on this journey towards making their city a community that protects the dignity, rights, and safety of all its people.”
“Under the consent decree, the city and BPD will implement comprehensive reforms to end the legacy of Baltimore’s ‘zero tolerance’ policing,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “In its place, BPD will empower its officers to engage in proactive, community-oriented policing. And given our experiences in many other cities, I firmly believe that when focused, measurable and detailed reforms are implemented effectively, they restore community trust and advance officer and public safety.”
Under the consent decree, the city of Baltimore and BPD will implement comprehensive reforms that will ensure that:
- Baltimore establishes a Community Oversight Task Force to recommend reforms to the current system of civilian oversight.
- BPD adopts a policing approach that is community-oriented and based on problem solving principles.
- Officers’ voluntary interactions are professional and courteous, and officers conduct all investigatory stops, searches and arrests in a manner that protects people’s rights.
- BPD provides equal protection of the law for all individuals, including providing impartial policing services.
- Officers use appropriate de-escalation techniques and attempt to resolve incidents without force when possible; use force in a manner that is proportional to the threat presented; and BPD’s use of force policies, training and review systems provide sufficient guidance, skills and accountability.
- BPD transports detainees in a manner that keeps them safe.
- Officers respect the First Amendment rights of all persons.
- BPD investigates sexual assault thoroughly and without gender bias.
- Baltimore conducts an assessment to minimize youth involvement with the juvenile and criminal justice systems, as appropriate, and that officers approach interactions with youth in a manner appropriate to their age.
- Baltimore conducts an analysis of gaps in the city’s mental health system in consultation with a committee of behavioral health experts and service providers, and BPD instructs and dispatches officers who are properly trained in interacting with people in crisis or with behavioral health disabilities when a police response is appropriate.
- Allegations of employee misconduct are fully, fairly and efficiently investigated; that all investigative findings are supported by the appropriate standard of proof and documented in writing; and that all officers who commit misconduct are held accountable pursuant to a disciplinary system that is fair, consistent and provides due process.
- Officers receive necessary equipment, policy guidance, training and support to do their jobs safely and effectively, and BPD performs a staffing study to ensure a sufficient number of officers and supervisors.
The Justice Department announced its findings in August 2016 following a thorough investigation into BPD started in May 2015. The department found that BPD made stops, searches and arrests without the required justification; used enforcement strategies that unlawfully subjected African Americans to disproportionate rates of stops, searches and arrests; used excessive force; and retaliated against individuals for their constitutionally-protected expression. The pattern or practice resulted from systemic deficiencies that persisted within BPD for many years and exacerbated community distrust of the police, particularly in African-American communities.
In October 2014, city and BPD leadership requested to enter a collaborative reform process with the Justice Department’s Office of Community Oriented Policing Services (COPS office). After the Civil Rights Division opened the pattern-or-practice investigation in May 2015, the COPS office and the Justice Department’s Office of Justice Programs have continued to offer federal resources, such as technical assistance, to the BPD, city officials and community leaders.
This investigation was conducted by the Civil Rights Division’s Special Litigation Section 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 also recently released a comprehensive report that provides an overview of the police reform work done under 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.
Baltimore Consent Decree Baltimore Consent Decree Fact Sheet Pattern or Practice Accomplishments DocumentJury Finds Army Veteran Guilty of Theft of Nearly $300,000 and Making A False StatementRead the Press Release
Jacksonville, FL – United States Attorney A. Lee Bentley, III announces that a federal jury has found Crystel Lee Riedling (44, Lake City) guilty of theft of government property and making a false statement. She faces a maximum penalty of 15 years in federal prison. Her sentencing hearing is scheduled for April 11, 2017. Riedling was indicted on February 18, 2016.
According to evidence presented at trial, Riedling, a U.S. Army veteran, received almost $300,000 in disability benefits over the past five to six years. She began receiving the benefits after claiming that she was completely unable to use her right arm. In reality, Riedling had use of her right arm and was seen using it. Two doctors testified that Riedling was malingering and exaggerating her injuries. Statements presented at trial also included Riedling’s admission that she knew that receiving these benefits was “completely wrong.” The jury also found Riedling guilty of making false statements to the United States after she told an investigator that she was totally and permanently disabled.
This case was investigated by the United States Department of Veterans Affairs – Office of Inspector General, the Social Security Administration - Office of the Inspector General, and the U.S. Department Health and Human Services – Office of Inspector General. It is being prosecuted by Assistant United States Attorney Jason Mehta.
Jury Convicts Former Teller of Embezzling from Bank in Coffey CountyRead the Press Release
TOPEKA, KAN. B A federal jury Thursday convicted a former teller at a bank in Burlington on charges of embezzling approximately $700,000, U.S. Attorney Tom Beall said today.
Denise Christy, 48, Burlington, Kan., was convicted on one count of embezzlement, six counts of making false bank entries, six counts of filing false tax returns and six counts of money laundering.
During trial, the prosecutor presented evidence the crimes were committed while Christy worked as a retail financial services representative and backup vault teller for the Burlington branch of Central National Bank. One of Christy’s duties was to sell cash in the bank’s vault to the Federal Reserve Bank. In May 2014 auditors determined that more than $700,000 was missing from the vault. Christy falsely claimed the money was shipped to the Federal Reserve Bank via the Garda security company. An investigation showed Christy falsified bank records to cover up the embezzlement and failed to report the embezzled funds as part of her income. In addition, she unlawfully conducted financial transactions in order to spend more than $77,000 in embezzled funds to pay off loans that she and her husband maintained at Farmers State Bank in Aliceville, Kan.
Sentencing is set for April 17. The crimes carry the following penalties:
Embezzlement: A maximum penalty of 30 years in federal prison and a fine up to $1 million.
Making false bank entries: A maximum penalty of 30 years in federal prison and a fine up to $1 million on each count.
False tax returns: A maximum penalty of three years and a fine up to $100,000 on each count.
Money laundering: A maximum penalty of 20 years and a fine up to $50,000 on each count.
Beall commended the Internal Revenue Service and Assistant U.S. Attorney Rich Hathaway for their work on the case.
Indiana Man Sentenced to 20 Years in Prison for Engaging in a Child Exploitation EnterpriseRead the Press Release
A member of a highly sophisticated, global child exploitation enterprise dedicated to the sexual exploitation of children was sentenced to prison today.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; U.S. Attorney Jill Westmoreland Rose of the Western District of North Carolina; Special Agent in Charge John A. Strong of the FBI’s Charlotte, North Carolina, Division; Special Agent in Charge Harold H. Shaw of the FBI’s Boston Division; and Special Agent in Charge Paul Wysopal of the FBI’s Tampa, Florida, Division made the announcement.
Michael Fluckiger, 46, of Portland, Indiana, was sentenced to 240 months in prison for engaging in a child exploitation enterprise, along with lifetime supervised release. U.S. District Judge Richard L. Voorhees of the Western District of North Carolina imposed the sentence. Fluckiger pleaded guilty on December 2, 2015 and has remained in the custody of the U.S. Marshals Service since his arrest on March 4, 2015.
According to admissions made in connection with the plea, Fluckiger acted as the co-administrator of a highly-sophisticated global enterprise dedicated to the sexual exploitation of children, organized via a members-only website that operated on the Tor anonymity network, through which he and more than 150,000 other members authored and viewed tens of thousands of postings relating to sexual abuse of children as young as infants and toddlers. According to admissions, Fluckiger was heavily involved in the day-to-day operations of the website – including managing membership, developing and enforcing strict rules and deleting website content that did not depict or discuss child pornography. In addition, Fluckiger admitted that website members employed advanced technological means in order to undermine law enforcement’s attempts to identify them, including the use of a hidden service on the Tor anonymity network and elaborate file encryption.
On Sept. 16, 2016, a federal jury convicted co-defendant and lead administrator of the site, Steven W. Chase, 57, of Naples, Florida, of engaging in a child exploitation enterprise and related charges. A sentencing date for Chase has not yet been set. Co-defendant and global moderator of the site, David Lynn Browning, 47, of Wooton, Kentucky, pleaded guilty on Dec. 18, 2015, and is scheduled to be sentenced on Feb. 7, 2017.
As a result of the ongoing investigation, at least 48 alleged hands-on abusers have been prosecuted and 49 American children who were subjected to sexual abuse have been successfully identified or rescued.
The FBI’s Violent Crimes Against Children Section, Major Case Coordination Unit and Digital Analysis and Research Center investigated the case with assistance from the FBI’s Charlotte, Tampa, and Boston, Field Offices. Trial Attorney Reginald E. Jones of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Cortney Randall of the Western District of North Carolina prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Indiana Man Sentenced to Prison for Engaging in A Child Exploitation EnterpriseRead the Press Release
CHARLOTTE, N.C. – A member of a highly sophisticated, global child exploitation enterprise dedicated to the sexual exploitation of children was sentenced to prison today.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; U.S. Attorney Jill Westmoreland Rose of the Western District of North Carolina; Special Agent in Charge John A. Strong of the FBI’s Charlotte, North Carolina, Division; Special Agent in Charge Harold H. Shaw of the FBI’s Boston Division; and Special Agent in Charge Paul Wysopal of the FBI’s Tampa, Florida, Division made the announcement.
Michael Fluckiger, 46, of Portland, Indiana, was sentenced to 240 months in prison for engaging in a child exploitation enterprise, along with lifetime supervised release. U.S. District Judge Richard L. Voorhees of the Western District of North Carolina imposed the sentence. Fluckiger pleaded guilty on December 2, 2015 and has remained in the custody of the U.S. Marshals Service since his arrest on March 4, 2015.
According to admissions made in connection with the plea, Fluckiger acted as the co-administrator of a highly-sophisticated global enterprise dedicated to the sexual exploitation of children, organized via a members-only website that operated on the Tor anonymity network, through which he and more than 150,000 other members authored and viewed tens of thousands of postings relating to sexual abuse of children as young as infants and toddlers. According to admissions, Fluckiger was heavily involved in the day-to-day operations of the website – including managing membership, developing and enforcing strict rules and deleting website content that did not depict or discuss child pornography. In addition, Fluckiger admitted that website members employed advanced technological means in order to undermine law enforcement’s attempts to identify them, including the use of a hidden service on the Tor anonymity network and elaborate file encryption.
On Sept. 16, 2016, a federal jury convicted co-defendant and lead administrator of the site, Steven W. Chase, 57, of Naples, Florida, of engaging in a child exploitation enterprise and related charges. A sentencing date for Chase has not yet been set. Co-defendant and global moderator of the site, David Lynn Browning, 47, of Wooton, Kentucky, pleaded guilty on December 18, 2015, and is scheduled to be sentenced on February 7, 2017.
As a result of the ongoing investigation, at least 48 alleged hands-on abusers have been prosecuted and 49 American children who were subjected to sexual abuse have been successfully identified or rescued.
The FBI’s Violent Crimes Against Children Section, Major Case Coordination Unit and Digital Analysis and Research Center investigated the case with assistance from the FBI’s Charlotte, Tampa, and Boston, Field Offices. Trial Attorney Reginald E. Jones of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Cortney Randall of the Western District of North Carolina prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Honduran National Indicted for Illegal Re-EntryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that CRISTIAN CESRE-PAZ, age 31, was charged today in a one-count Indictment for illegal reentry of a removed alien, in violation of Title 8, United States Code, Section 1326(a) & (b)(2).
According to the Indictment, CESRE-PAZ reentered the United States after he was previously deported on December 27, 2006. If convicted, CESRE-PAZ faces a maximum term of imprisonment of ten years, a maximum fine of $250,000, a maximum term of supervised release of three years, and a mandatory $100 special assessment.
U.S. Attorney Polite reiterated that an Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security in investigating this matter. Assistant U.S. Attorney Spiro G. Latsis is in charge of the prosecution.