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Wednesday 11 January 2017
Thibodaux Man Sentenced for an Extensive Computer Hacking Scheme Involving Nearly 50 VictimsRead the Press Release
U.S. Attorney Kenneth A. Polite announced that BRADER YELVERTON, age 24, of Thibodaux, was sentenced today after previously pleading guilty as charged to a one-count Bill of Information charging him with unauthorized access of a protected computer.
U.S. District Judge Jay C. Zainey sentenced YELVERTON to 5 years probation and $3,500 in restitution.
According to court documents, between about 2013 and December 2015, YELVERTON accessed the personal online accounts, including email, educational, social media, and “cloud” storage accounts of at least 49 individuals without their knowledge or authorization. All of the individuals whose accounts YELVERTON accessed without authorization were individuals he knew. The vast majority of the victims were females, as well as several of their significant others.
YELVERTON obtained access to an account by using publicly accessible information, or information he knew about the victim, to isolate the password for one of the accounts, usually his/her social media account. YELVERTON then used the information contained in the social media account to obtain the password to other accounts of the victim. Once he obtained access to the accounts, YELVERTON changed the passwords so that he could continue to access them. After YELVERTON obtained access to the accounts, he searched through them and obtained personal information of the victims, including, in some cases, sensitive photographs of the victims.
In the case of one victim, YELVERTON viewed not more than 380 pictures stored on her various online accounts. After saving some of the pictures to his personal computer, YELVERTON uploaded at least two private, sensitive photographs of the victim that he obtained from her private accounts onto an online anonymous image trading board that provides for state-specific and city-specific fora for individuals to upload, view, download, and trade images. During the upload process, YELVERTON entitled the images using the first name and last initial of the victim, so that other visitors to the website could readily identify the victim.
U.S. Attorney Polite praised the work of the Federal Bureau of Investigation in investigating this matter. Assistant United States Attorney Jordan Ginsberg was in charge of the prosecution.
Spartanburg Initiative to Combat Domestic Violence Results in First Guilty PleaRead the Press Release
Contact Person: Lance Crick (864) 282-2100
SPARTANBURG, South Carolina ---- United States Attorney Beth Drake stated today that James Lee Sarratt, Jr., age 49, of Spartanburg, entered a guilty plea this morning in federal court in Greenville for illegally possessing a firearm. United States District Judge Bruce H. Hendricks presided over the guilty plea hearing and will impose a sentence after a presentence investigation report is prepared by United States Probation.
Sarratt, a previously convicted felon who is prohibited from possessing firearms or ammunition, faces a maximum of 10 years in federal prison. Sarratt was arrested on federal firearms charges on October 31, 2016, and has remained in custody, detained without bond, since his federal arrest.
The facts presented at the guilty plea hearing established that on the morning of September 30, 2016, members of the Spartanburg County Sheriff’s Office (SCSO) responded to a domestic disturbance involving a firearm at a residence in
Spartanburg. When deputies arrived at the residence, witnesses alerted SCSO that Sarratt had a firearm. Sarratt did not have a firearm on him when deputies approached him but Sarratt later admitted he put the firearm in a truck at the residence. Inside the bedroom of the residence, a male was on the floor with a gunshot wound to his abdomen.
One witness told SCSO that during an argument in the bedroom, with the child present, Sarratt retrieved his .40 caliber pistol from under the mattress. Ultimately one witness attempted to grab Sarratt’s arm. The gun went off and the witness fell to the ground, shot in the abdomen. Sarratt then left the residence to place his firearm in his truck.
A search warrant obtained for the property yielded a black Hi-Point JCP, .40 caliber pistol loaded with seven (7) rounds of Winchester .40 caliber ammunition in a pick-up truck and a box containing fourteen (14) rounds of Winchester .40 caliber ammunition in the bedroom.
Sarratt’s case was investigated by the Spartanburg County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). The case is assigned to First Assistant United States Attorney Lance Crick.
Sarratt’s plea was the first one to emanate out of “Home Front”, a focused deterrence-based initiative to combat domestic violence led by 7th Circuit Solicitor Barry Barnette. The initiative, launched last month has the support and partnership of the U.S. Attorney’s Office.
Modelled after a program started in High Point, NC, members of the Home Front task force began earlier this fall, meeting with representatives from every police department in Spartanburg county as well as the Sheriff’s Office. The Spartanburg County State Probation office and victim’s advocate stalwart, SAFE Homes, also serve as critical partners in this effort.
Under the guidance of Solicitor Barnette and High Point (NC) Chief Marty Sumner, Home Front has quickly gone from concept to reality. High Point’s model and research suggests that early intervention is key in stopping the cycle of violence. The Home Front strategy identifies and focuses on offenders at the earliest stages of offending, before their violent conduct is entrenched and escalating.
According to the Center for Disease Control and Prevention, domestic violence is a community crime problem that costs the United States over $5.8 billion every year. It is a major drain on law enforcement resources as domestic violence generates a high volume of calls and repeated calls to the same location. Domestic violence homicides make up 40–50 percent of all murders of women in the United States. Women who have experienced a history of domestic violence report more health problems than other women and they have a greater risk for substance abuse, unemployment, alcoholism, and suicide attempts.
Research shows that the repeat domestic violence offender tends to have a significant criminal history that includes a wide range of both domestic violence and non-domestic violence offenses. Most of these offenders are readily identified as they are known to the criminal justice system. The Home Front initiative exposes the repeat domestic violence offender to sanctions because of his pattern of criminal behavior.
According to the 2015 Violence Policy Center When Men Murder Women report, South Carolina led the nation in rates of women murdered by men. Sixty-six percent (66%) of the victims were killed with a firearm and ninety-six percent (96%) of women murdered were killed by someone they knew.
In Spartanburg County during the 2015 calendar year, SAFE Homes serviced 6726 victims of domestic violence. In the same time frame, the Spartanburg Police Department charged 907 domestic violence cases and the Spartanburg County Sheriff’s Office charged 1068 domestic violence cases. There were fourteen (14) domestic related deaths in Spartanburg County in 2015.
Solicitor Barnette has had enough. “Domestic violence is violence, period. It continues to plague our community--so costly and harmful to families and children, persisting year after year. It is time for these offenders to get our best shot—our best efforts. That is Home Front.”
United States Attorney Beth Drake agrees. “The U.S. Attorney’s Office and the Bureau of Alcohol, Tobacco and Firearms welcome the opportunity to partner with Solicitor Barnette and state law enforcement, and to use federal gun laws to pull violent offenders who are abusing their families and loved ones out of the community. The goal is simple – stop the abuse, or swift and sure, the full force of a coordinated law enforcement effort will come to bear to stop you from abusing. Home Front takes the burden of addressing abusers from the victims and shifts it to us – a very engaged group of local, state, and federal law enforcement.”
The Home Front task force began a thorough, eight-step implementation process in the fall. The steps included training officers, synchronizing the coding of calls among the law enforcement agencies to harmonize communication--to create a back stop of sorts so that no domestic calls or offenders slip through the cracks among the sixteen municipal law enforcement entities in Spartanburg County. Very early in the implementation process, the task force began creating a comprehensive list of domestic violence offenders from the previous twelve months of arrests in Spartanburg County for domestic-related incidents. Offenders were categorized from most dangerous (Class A), repeat offender (Class B), first time DV arrest (Class C), and any non-arrest domestic violence interface with law enforcement (Class D). For the most serious or repeat offenders, pending cases are fast-tracked to ATF and the US Attorney’s Office for immediate federal prosecution or prioritized for expedited state prosecution. This process includes creating an enhanced system of tracking for offenders who are notified at any level or category. Custom notification letters, hand-delivered by law enforcement to offenders within 48 hours of the initial law enforcement contact, serve to alert offenders that they are on the Home Front radar going forward as well as detailing presumptive sentences for future acts of violence or prohibited behavior.
Solicitor Barnette is optimistic about the collaboration and is confident the focus and dedication of this task force will not waiver. “Securing our communities and ensuring that victims and children can feel safe in their own homes—breaking this horrific cycle of violence, that is our charge.”
Home Front Task Force:City of Spartanburg Police Department
City of Campobello
City of Pacolet Police Department
City of Chesnee Police Department
City of Cowpens Police Department
City of Duncan Police Department
City of Greer Police Department
City of Inman Police Department
City of Landrum Police Department
City of Lyman Police Department
City of Wellford Police Department
City of Woodruff Police Department
Spartanburg County Sheriff’s Office
Greenville-Spartanburg International Airport Police Department
Victim Advocates
Victim Services Providers
Behavioral Health
SC Dept. of Probation, Pardon and Parole Services
U. S. Attorney's Office, District of South Carolina
Bureau of Alcohol, Tobacco and Firearms
Seventh Circuit Solicitor’s Office
SAFE Homes
Children’s Advocacy Center of Spartanburg, Cherokee, & Union#####
Shire Plc Subsidiaries to Pay $350 Million to Settle False Claims Act AllegationsRead the Press Release
Tampa, FL – United States Attorney A. Lee Bentley, III announced today that Shire Pharmaceuticals LLC and other subsidiaries of Shire plc (Shire) will pay $350 million to settle federal and state False Claims Act allegations that Shire and the company it acquired in 2011, Advanced BioHealing (ABH), employed kickbacks and other unlawful methods to induce clinics and physicians to use or overuse its product “Dermagraft,” a bioengineered human skin substitute approved by the FDA for the treatment of diabetic foot ulcers. Shire plc is a multinational pharmaceutical firm headquartered in Ireland, with its United States operational headquarters in Lexington, Massachusetts. Shire sold the assets associated with Dermagraft in early 2014.
“Flagrant and systemic kickback activity of the type at issue in this case is designed to impair and undermine a physician’s independent medical judgment, and will not be tolerated,” said U.S. Attorney Bentley. “This lawsuit and today’s historic settlement demonstrate our office’s vigilant and on-going efforts to safeguard federal health care program beneficiaries from the effects of such illegal and deplorable conduct.” In addition to this landmark civil settlement, the office continues to work diligently to bring to justice those individuals responsible for these illegal actions. Already, the MDFL has obtained the criminal convictions of three high-level executives who supervised the implementation of the illegal kickback scheme, as well as a number of healthcare providers who received kickbacks.
“This settlement represents the largest False Claims Act recovery by the United States in a kickback case involving a medical device,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “Kickbacks by suppliers of healthcare goods and services cast a pall over the integrity of our health care system. Patients deserve the unfettered, independent judgment of their health care professionals.”
The settlement resolves allegations that Dermagraft salespersons unlawfully induced clinics and physicians with lavish dinners, drinks, entertainment and travel; medical equipment and supplies; unwarranted payments for purported speaking engagements and bogus case studies; and cash, credits and rebates, to induce the use of Dermagraft. The Anti-Kickback Statute prohibits, among other things, the payment of remuneration to induce the use of medical devices covered by Medicare, Medicaid and other federally-funded health care programs, including the Department of Veterans Affairs (VA). Claims filed in violation of the Anti-Kickback Statute are considered false or fraudulent under the False Claims Act. In addition, the Anti-Bribery statute and the Federal Acquisition Regulations prohibit bribes to government officials or employees, including VA physicians, to obtain a contract or favorable treatment under a supply contract. The United States alleged that as a result of its violation of these provisions, Shire submitted or caused to be submitted to federally-funded health care programs hundreds of millions of dollars of false claims for Dermagraft.
The U.S. Attorney’s Office for the District of Columbia also played an active role in this investigation, seeking redress in the civil agreement announced today for the losses sustained by the VA. “Giving kickbacks and gratuities to healthcare providers corrupts medical treatment by interjecting personal financial incentives into decisions that should focus on what is best for a particular patient,” said U.S. Attorney Channing D. Phillips for the District of Columbia. “These types of unlawful incentives are particularly troubling when they seek to corrupt the medical treatment provided to our nation’s veterans. We will aggressively pursue any company that engages in such reprehensible and unlawful conduct, which seeks to put a company’s financial gains ahead of providing the best medical treatment for those who bravely served in our Armed Forces.”
The U.S. Attorneys’ Office for the Eastern District of Pennsylvania and the Middle District of Tennessee also contributed to the investigation and resolution of these matters. “Fraud against the health care program that exists for the benefit of our veterans, some of our most cherished citizens, as well as fraud against the Medicare program, is reprehensible and unacceptable,” said the Acting U.S. Attorney Louis D. Lappen for the Eastern District of Pennsylvania. “This resolution again demonstrates the capacity of the Department of Justice and our law enforcement partners across the country to work together to address unlawful conduct nationwide that affects veterans and other beneficiaries of federally funded health care programs.”
“The best interest of the patient is, and must be, the primary factor in a physician’s decision regarding patient care,” said U.S. Attorney David Rivera for the Middle District of Tennessee. “As such, federal law protects patients from medical providers who enrich themselves through bribes and kickbacks by making illegal the payment of remuneration to induce the use of medical devises covered by federally-funded health care programs. Such kickback schemes that interfere with physician-patient relationships and drive up the cost of healthcare for everyone, will be vigorously pursued and aggressively prosecuted.”
“U.S. Department of Veterans Affairs healthcare providers are obligated to render care free of any improper financial influences” said Special Agent in Charge Michael E. Seitler of the U.S. Department of Veterans Affairs, Office of Inspector General (VA OIG), Northwest Field Office. “This is particularly important at VA, since we care for many of this nation’s heroes who have sacrificed their own welfare for our freedom. In this case, ABH saw a dramatic rise in its sales to the VA during the period of time it provided illegal inducements to multiple VA clinicians across the country. These corrupt practices served to erode the public trust in our healthcare system. The VA OIG is committed to investigating, and bringing to justice, those who engage in these illegal practices.”
In addition to the kickback allegations, the settlement also resolved allegations that Shire and its predecessor (ABH) unlawfully marketed Dermagraft for uses not approved by the FDA, made false statements to inflate the price of Dermagraft, and caused improper coding, verification, or certification of Dermagraft claims and related services.
The allegations resolved by the settlement were brought in six lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims and to receive a share of any recovery. The whistleblower shares to be awarded in this case have not yet been determined.
The six qui tam cases, all of which were either filed or transferred to the U.S. District Court for the Middle District of Florida, are captioned: United States ex rel. Vinca v. Advanced BioHealing, Inc., Case No. 8:11-cv-176-T-30MAP; United States ex rel. Harvey v. Advanced BioHealing, Inc., Case No. 8:16-cv-303-T-30TBM; United States ex rel. Medolla v. Advanced BioHealing, Inc., Case No. 8:12-cv-575-T-30TBM; United States, et al., ex rel. Petty v. Shire Regenerative Medicine, Inc., Case No. 8:14-cv-969-T-30TBM; United States ex rel. Webb v. Advanced BioHealing, Inc., Case No. 8:14-cv-1055-T-30EAJ; and United States ex rel. Montecalvo v. Shire Regenerative Medicine, Inc., Case No. 8:16-cv-268-T-30TBM.
These matters were investigated by the Civil Division’s Commercial Litigation Branch; the U.S. Attorneys’ Offices for the Middle District of Florida, District of Columbia, Middle District of Tennessee and Eastern District of Pennsylvania; the FBI; the U.S. Department of Health and Human Services (HHS) Office of Inspector General; the VA OIG and the Department of Defense Criminal Investigative Service. These cases were handled locally by Assistant United States Attorneys Randy Harwell and Chris Tuite working jointly with Department of Justice Trial Attorney Richard Nicholson.
Shire, which cooperated in the government’s investigation, has been operating under a Corporate Integrity Agreement entered into with HHS that was implemented in late 2014, after the alleged unlawful conduct resolved by today’s settlement occurred, in connection with the settlement of separate False Claims Act allegations.
“Patients must be able to trust that decisions made by their doctors are based on unbiased professional judgment and not personal gain,” said Chief Counsel Gregory E. Demske to the HHS Inspector General. “The Office of the Inspector General will continue to monitor Shire’s compliance with federal healthcare programs through its oversight of Shire’s Corporate Integrity Agreement.”
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $31.4 billion through False Claims Act cases, with more than $19.6 billion of that amount recovered in cases involving fraud against federal health care programs.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Shire PLC Subsidiaries to Pay $350 Million to Settle False Claims Act AllegationsRead the Press Release
The Justice Department announced today that Shire Pharmaceuticals LLC and other subsidiaries of Shire plc (Shire) will pay $350 million to settle federal and state False Claims Act allegations that Shire and the company it acquired in 2011, Advanced BioHealing (ABH), employed kickbacks and other unlawful methods to induce clinics and physicians to use or overuse its product “Dermagraft,” a bioengineered human skin substitute approved by the FDA for the treatment of diabetic foot ulcers. Shire plc is a multinational pharmaceutical firm headquartered in Ireland, with its United States operational headquarters in Lexington, Massachusetts. Shire sold the assets associated with Dermagraft in early 2014.
“This settlement represents the largest False Claims Act recovery by the United States in a kickback case involving a medical device,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “Kickbacks by suppliers of healthcare goods and services cast a pall over the integrity of our health care system. Patients deserve the unfettered, independent judgment of their health care professionals.”
The settlement resolves allegations that Dermagraft salespersons unlawfully induced clinics and physicians with lavish dinners, drinks, entertainment and travel; medical equipment and supplies; unwarranted payments for purported speaking engagements and bogus case studies; and cash, credits and rebates, to induce the use of Dermagraft. The Anti-Kickback Statute prohibits, among other things, the payment of remuneration to induce the use of medical devices covered by Medicare, Medicaid and other federally-funded health care programs, including the Department of Veterans Affairs (VA). Claims filed in violation of the Anti-Kickback Statute are considered false or fraudulent under the False Claims Act. In addition, the Anti-Bribery statute and the Federal Acquisition Regulations prohibit bribes to government officials or employees, including VA physicians, to obtain a contract or favorable treatment under a supply contract. The United States alleged that as a result of their violation of these provisions, ABH and Shire submitted or caused to be submitted to federally-funded health care programs hundreds of millions of dollars of false claims for Dermagraft.
“Flagrant and systemic kickback activity of the type at issue in this case is designed to impair and undermine a physician’s independent medical judgment, and will not be tolerated,” said U.S. Attorney A. Lee Bentley III for the Middle District of Florida (MDFL). “This lawsuit and today’s historic settlement demonstrate our office’s vigilant and on-going efforts to safeguard federal health care program beneficiaries from the effects of such illegal and deplorable conduct.” In addition to this landmark civil settlement, Mr. Bentley’s office continues to work diligently to bring to justice those individuals responsible for these illegal actions. Already, the MDFL has obtained the criminal convictions of three high-level executives who supervised the implementation of the illegal kickback scheme, as well as a number of healthcare providers who received kickbacks.
The U.S. Attorney’s Office for the District of Columbia also played an active role in this investigation, seeking redress in the civil agreement announced today for the losses sustained by the VA. “Giving kickbacks and gratuities to healthcare providers corrupts medical treatment by interjecting personal financial incentives into decisions that should focus on what is best for a particular patient,” said U.S. Attorney Channing D. Phillips for the District of Columbia. “These types of unlawful incentives are particularly troubling when they seek to corrupt the medical treatment provided to our nation’s veterans. We will aggressively pursue any company that engages in such reprehensible and unlawful conduct, which seeks to put a company’s financial gains ahead of providing the best medical treatment for those who bravely served in our Armed Forces.”
The U.S. Attorneys’ Office for the Eastern District of Pennsylvania and the Middle District of Tennessee also contributed to the investigation and resolution of these matters. “Fraud against the health care program that exists for the benefit of our veterans, some of our most cherished citizens, as well as fraud against the Medicare program, is reprehensible and unacceptable,” said the Acting U.S. Attorney Louis D. Lappen for the Eastern District of Pennsylvania. “This resolution again demonstrates the capacity of the Department of Justice and our law enforcement partners across the country to work together to address unlawful conduct nationwide that affects veterans and other beneficiaries of federally funded health care programs.”
“The best interest of the patient is, and must be, the primary factor in a physician’s decision regarding patient care,” said U.S. Attorney David Rivera for the Middle District of Tennessee. “As such, federal law protects patients from medical providers who enrich themselves through bribes and kickbacks by making illegal the payment of remuneration to induce the use of medical devises covered by federally-funded health care programs. Such kickback schemes that interfere with physician-patient relationships and drive up the cost of healthcare for everyone, will be vigorously pursued and aggressively prosecuted.”
"U.S. Department of Veterans Affairs healthcare providers are obligated to render care free of any improper financial influences” said Special Agent in Charge Michael E. Seitler of the U.S. Department of Veterans Affairs, Office of Inspector General (VA OIG), Northwest Field Office. “This is particularly important at VA, since we care for many of this nation’s heroes who have sacrificed their own welfare for our freedom. In this case, ABH saw a dramatic rise in its sales to the VA during the period of time it provided illegal inducements to multiple VA clinicians across the country. These corrupt practices served to erode the public trust in our healthcare system. The VA OIG is committed to investigating, and bringing to justice, those who engage in these illegal practices.”
In addition to the kickback allegations, the settlement also resolved allegations that Shire and its predecessor ABH unlawfully marketed Dermagraft for uses not approved by the FDA, made false statements to inflate the price of Dermagraft, and caused improper coding, verification, or certification of Dermagraft claims and related services.
The allegations resolved by the settlement were brought in six lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims and to receive a share of any recovery. The whistleblower shares to be awarded in this case have not yet been determined.
The six qui tam cases, all of which were either filed or transferred to the U.S. District Court for the Middle District of Florida, are captioned: United States ex rel. Vinca v. Advanced BioHealing, Inc., Case No. 8:11-cv-176-T-30MAP; United States ex rel. Harvey v. Advanced BioHealing, Inc., Case No. 8:16-cv-303-T-30TBM; United States ex rel. Medolla v. Advanced BioHealing, Inc., Case No. 8:12-cv-575-T-30TBM; United States, et al., ex rel. Petty v. Shire Regenerative Medicine, Inc., Case No. 8:14-cv-969-T-30TBM; United States ex rel. Webb v. Advanced BioHealing, Inc., Case No. 8:14-cv-1055-T-30EAJ; and United States, et al., ex rel. Montecalvo v. Shire Regenerative Medicine, Inc., Case No. 8:16-cv-268-T-30TBM.
These matters were investigated by the Civil Division’s Commercial Litigation Branch; the U.S. Attorneys’ Offices for the Middle District of Florida, District of Columbia, Middle District of Tennessee and Eastern District of Pennsylvania; the FBI; the U.S. Department of Health and Human Services (HHS) Office of Inspector General; the VA OIG and the Department of Defense Criminal Investigative Service.
Shire, which cooperated in the government’s investigation, has been operating under a Corporate Integrity Agreement entered into with HHS that was implemented in late 2014, after the alleged unlawful conduct resolved by today’s settlement occurred, in connection with the settlement of separate False Claims Act allegations.
“Patients must be able to trust that decisions made by their doctors are based on unbiased professional judgment and not personal gain,” said Chief Counsel Gregory E. Demske to the HHS Inspector General. “The Office of the Inspector General will continue to monitor Shire’s compliance with federal healthcare programs through its oversight of Shire’s Corporate Integrity Agreement.”
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $31.4 billion through False Claims Act cases, with nearly $19.6 billion of that amount recovered in cases involving fraud against federal health care programs.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Shire PLC Subsidiaries to Pay $350 Million to Settle False Claims Act AllegationsRead the Press Release
WASHINGTON – The Justice Department announced today that Shire Pharmaceuticals LLC and other subsidiaries of Shire plc (Shire) will pay $350 million to settle federal and state False Claims Act allegations that Shire and the company it acquired in 2011, Advanced BioHealing (ABH), employed kickbacks and other unlawful methods to induce clinics and physicians to use or overuse its product “Dermagraft,” a bioengineered human skin substitute approved by the FDA for the treatment of diabetic foot ulcers. Shire plc is a multinational pharmaceutical firm headquartered in Ireland, with its United States operational headquarters in Lexington, Massachusetts. Shire sold the assets associated with Dermagraft in early 2014.
“This settlement represents the largest False Claims Act recovery by the United States in a kickback case involving a medical device,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “Kickbacks by suppliers of healthcare goods and services cast a pall over the integrity of our health care system. Patients deserve the unfettered, independent judgment of their health care professionals.”
The settlement resolves allegations that Dermagraft salespersons unlawfully induced clinics and physicians with lavish dinners, drinks, entertainment and travel; medical equipment and supplies; unwarranted payments for purported speaking engagements and bogus case studies; and cash, credits and rebates, to induce the use of Dermagraft. The Anti-Kickback Statute prohibits, among other things, the payment of remuneration to induce the use of medical devices covered by Medicare, Medicaid and other federally-funded health care programs, including the Department of Veterans Affairs (VA). Claims filed in violation of the Anti-Kickback Statute are considered false or fraudulent under the False Claims Act. In addition, the Anti-Bribery statute and the Federal Acquisition Regulations prohibit bribes to government officials or employees, including VA physicians, to obtain a contract or favorable treatment under a supply contract. The United States alleged that as a result of their violation of these provisions, ABH and Shire submitted or caused to be submitted to federally-funded health care programs hundreds of millions of dollars of false claims for Dermagraft.
“Flagrant and systemic kickback activity of the type at issue in this case is designed to impair and undermine a physician’s independent medical judgment, and will not be tolerated,” said U.S. Attorney A. Lee Bentley III for the Middle District of Florida (MDFL). “This lawsuit and today’s historic settlement demonstrate our office’s vigilant and on-going efforts to safeguard federal health care program beneficiaries from the effects of such illegal and deplorable conduct.” In addition to this landmark civil settlement, Mr. Bentley’s office continues to work diligently to bring to justice those individuals responsible for these illegal actions. Already, the MDFL has obtained the criminal convictions of three high-level executives who supervised the implementation of the illegal kickback scheme, as well as a number of healthcare providers who received kickbacks.
The U.S. Attorney’s Office for the District of Columbia also played an active role in this investigation, seeking redress in the civil agreement announced today for the losses sustained by the VA. “Giving kickbacks and gratuities to healthcare providers corrupts medical treatment by interjecting personal financial incentives into decisions that should focus on what is best for a particular patient,” said U.S. Attorney Channing D. Phillips for the District of Columbia. “These types of unlawful incentives are particularly troubling when they seek to corrupt the medical treatment provided to our nation’s veterans. We will aggressively pursue any company that engages in such reprehensible and unlawful conduct, which seeks to put a company’s financial gains ahead of providing the best medical treatment for those who bravely served in our Armed Forces.”
The U.S. Attorneys’ Office for the Eastern District of Pennsylvania and the Middle District of Tennessee also contributed to the investigation and resolution of these matters. “Fraud against the health care program that exists for the benefit of our veterans, some of our most cherished citizens, as well as fraud against the Medicare program, is reprehensible and unacceptable,” said the Acting U.S. Attorney Louis D. Lappen for the Eastern District of Pennsylvania. “This resolution again demonstrates the capacity of the Department of Justice and our law enforcement partners across the country to work together to address unlawful conduct nationwide that affects veterans and other beneficiaries of federally funded health care programs.”
“The best interest of the patient is, and must be, the primary factor in a physician’s decision regarding patient care,” said U.S. Attorney David Rivera for the Middle District of Tennessee. “As such, federal law protects patients from medical providers who enrich themselves through bribes and kickbacks by making illegal the payment of remuneration to induce the use of medical devises covered by federally-funded health care programs. Such kickback schemes that interfere with physician-patient relationships and drive up the cost of healthcare for everyone, will be vigorously pursued and aggressively prosecuted.”
"U.S. Department of Veterans Affairs healthcare providers are obligated to render care free of any improper financial influences” said Special Agent in Charge Michael E. Seitler of the U.S. Department of Veterans Affairs, Office of Inspector General (VA OIG), Northwest Field Office. This is particularly important at VA, since we care for many of this nation’s heroes who have sacrificed their own welfare for our freedom. In this case, ABH saw a dramatic rise in its sales to the VA during the period of time it provided illegal inducements to multiple VA clinicians across the country. These corrupt practices served to erode the public trust in our healthcare system. The VA OIG is committed to investigating, and bringing to justice, those who engage in these illegal practices.”
In addition to the kickback allegations, the settlement also resolved allegations that Shire and its predecessor ABH unlawfully marketed Dermagraft for uses not approved by the FDA, made false statements to inflate the price of Dermagraft, and caused improper coding, verification, or certification of Dermagraft claims and related services.
The allegations resolved by the settlement were brought in six lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims and to receive a share of any recovery. The whistleblower shares to be awarded in this case have not yet been determined.
The six qui tam cases, all of which were either filed or transferred to the U.S. District Court for the Middle District of Florida, are captioned: United States ex rel. Vinca v. Advanced BioHealing, Inc., Case No. 8:11-cv-176-T-30MAP; United States ex rel. Harvey v. Advanced BioHealing, Inc., Case No. 8:16-cv-303-T-30TBM; United States ex rel. Medolla v. Advanced BioHealing, Inc., Case No. 8:12-cv-575-T-30TBM; United States, et al., ex rel. Petty v. Shire Regenerative Medicine, Inc., Case No. 8:14-cv-969-T-30TBM; United States ex rel. Webb v. Advanced BioHealing, Inc., Case No. 8:14-cv-1055-T-30EAJ; and United States, et al., ex rel. Montecalvo v. Shire Regenerative Medicine, Inc., Case No. 8:16-cv-268-T-30TBM.
These matters were investigated by the Civil Division’s Commercial Litigation Branch; the U.S. Attorneys’ Offices for the Middle District of Florida, District of Columbia, Middle District of Tennessee and Eastern District of Pennsylvania; the FBI; the U.S. Department of Health and Human Services (HHS) Office of Inspector General; the VA OIG and the Department of Defense Criminal Investigative Service.
Shire, which cooperated in the government’s investigation, has been operating under a Corporate Integrity Agreement entered into with HHS that was implemented in late 2014, after the alleged unlawful conduct resolved by today’s settlement occurred, in connection with the settlement of separate False Claims Act allegations.
“Patients must be able to trust that decisions made by their doctors are based on unbiased professional judgment and not personal gain,” said Chief Counsel Gregory E. Demske to the HHS Inspector General. “The Office of the Inspector General will continue to monitor Shire’s compliance with federal healthcare programs through its oversight of Shire’s Corporate Integrity Agreement.”
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $31.4 billion through False Claims Act cases, with nearly $19.6 billion of that amount recovered in cases involving fraud against federal health care programs.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Shire PLC Subsidiaries to Pay $350 Million to Settle False Claims Act AllegationsRead the Press Release
Washington - The Justice Department announced today that Shire Pharmaceuticals LLC and other subsidiaries of Shire plc (Shire) will pay $350 million to settle federal and state False Claims Act allegations that Shire and the company it acquired in 2011, Advanced BioHealing (ABH), employed kickbacks and other unlawful methods to induce clinics and physicians to use or overuse its product “Dermagraft,” a bioengineered human skin substitute approved by the FDA for the treatment of diabetic foot ulcers. Shire plc is a multinational pharmaceutical firm headquartered in Ireland, with its United States operational headquarters in Lexington, Massachusetts. Shire sold the assets associated with Dermagraft in early 2014.
“This settlement represents the largest False Claims Act recovery by the United States in a kickback case involving a medical device,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “Kickbacks by suppliers of healthcare goods and services cast a pall over the integrity of our health care system. Patients deserve the unfettered, independent judgment of their health care professionals.”
The settlement resolves allegations that Dermagraft salespersons unlawfully induced clinics and physicians with lavish dinners, drinks, entertainment and travel; medical equipment and supplies; unwarranted payments for purported speaking engagements and bogus case studies; and cash, credits and rebates, to induce the use of Dermagraft. The Anti-Kickback Statute prohibits, among other things, the payment of remuneration to induce the use of medical devices covered by Medicare, Medicaid and other federally-funded health care programs, including the Department of Veterans Affairs (VA). Claims filed in violation of the Anti-Kickback Statute are considered false or fraudulent under the False Claims Act. In addition, the Anti-Bribery statute and the Federal Acquisition Regulations prohibit bribes to government officials or employees, including VA physicians, to obtain a contract or favorable treatment under a supply contract. The United States alleged that as a result of their violation of these provisions, ABH and Shire submitted or caused to be submitted to federally-funded health care programs hundreds of millions of dollars of false claims for Dermagraft.
“Flagrant and systemic kickback activity of the type at issue in this case is designed to impair and undermine a physician’s independent medical judgment, and will not be tolerated,” said U.S. Attorney A. Lee Bentley III for the Middle District of Florida (MDFL). “This lawsuit and today’s historic settlement demonstrate our office’s vigilant and on-going efforts to safeguard federal health care program beneficiaries from the effects of such illegal and deplorable conduct.” In addition to this landmark civil settlement, Mr. Bentley’s office continues to work diligently to bring to justice those individuals responsible for these illegal actions. Already, the MDFL has obtained the criminal convictions of three high-level executives who supervised the implementation of the illegal kickback scheme, as well as a number of healthcare providers who received kickbacks.
The U.S. Attorney’s Office for the District of Columbia also played an active role in this investigation, seeking redress in the civil agreement announced today for the losses sustained by the VA. “Giving kickbacks and gratuities to healthcare providers corrupts medical treatment by interjecting personal financial incentives into decisions that should focus on what is best for a particular patient,” said U.S. Attorney Channing D. Phillips for the District of Columbia. “These types of unlawful incentives are particularly troubling when they seek to corrupt the medical treatment provided to our nation’s veterans. We will aggressively pursue any company that engages in such reprehensible and unlawful conduct, which seeks to put a company’s financial gains ahead of providing the best medical treatment for those who bravely served in our Armed Forces.”
The U.S. Attorneys’ Office for the Eastern District of Pennsylvania and the Middle District of Tennessee also contributed to the investigation and resolution of these matters. “Fraud against the health care program that exists for the benefit of our veterans, some of our most cherished citizens, as well as fraud against the Medicare program, is reprehensible and unacceptable,” said the Acting U.S. Attorney Louis D. Lappen for the Eastern District of Pennsylvania. “This resolution again demonstrates the capacity of the Department of Justice and our law enforcement partners across the country to work together to address unlawful conduct nationwide that affects veterans and other beneficiaries of federally funded health care programs.”
“The best interest of the patient is, and must be, the primary factor in a physician’s decision regarding patient care,” said U.S. Attorney David Rivera for the Middle District of Tennessee. “As such, federal law protects patients from medical providers who enrich themselves through bribes and kickbacks by making illegal the payment of remuneration to induce the use of medical devises covered by federally-funded health care programs. Such kickback schemes that interfere with physician-patient relationships and drive up the cost of healthcare for everyone, will be vigorously pursued and aggressively prosecuted.”
U.S. Department of Veterans Affairs healthcare providers are obligated to render care free of any improper financial influences” said Special Agent in Charge Michael E. Seitler of the U.S. Department of Veterans Affairs, Office of Inspector General (VA OIG), Northwest Field Office. “This is particularly important at VA, since we care for many of this nation’s heroes who have sacrificed their own welfare for our freedom. In this case, ABH saw a dramatic rise in its sales to the VA during the period of time it provided illegal inducements to multiple VA clinicians across the country. These corrupt practices served to erode the public trust in our healthcare system. The VA OIG is committed to investigating, and bringing to justice, those who engage in these illegal practices.”
In addition to the kickback allegations, the settlement also resolved allegations that Shire and its predecessor ABH unlawfully marketed Dermagraft for uses not approved by the FDA, made false statements to inflate the price of Dermagraft, and caused improper coding, verification, or certification of Dermagraft claims and related services.
The allegations resolved by the settlement were brought in six lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims and to receive a share of any recovery. The whistleblower shares to be awarded in this case have not yet been determined.
The six qui tam cases, all of which were either filed or transferred to the U.S. District Court for the Middle District of Florida, are captioned: United States ex rel. Vinca v. Advanced BioHealing, Inc., Case No. 8:11-cv-176-T-30MAP; United States ex rel. Harvey v. Advanced BioHealing, Inc., Case No. 8:16-cv-303-T-30TBM; United States ex rel. Medolla v. Advanced BioHealing, Inc., Case No. 8:12-cv-575-T-30TBM; United States, et al., ex rel. Petty v. Shire Regenerative Medicine, Inc., Case No. 8:14-cv-969-T-30TBM; United States ex rel. Webb v. Advanced BioHealing, Inc., Case No. 8:14-cv-1055-T-30EAJ; and United States, et al., ex rel. Montecalvo v. Shire Regenerative Medicine, Inc., Case No. 8:16-cv-268-T-30TBM.
These matters were investigated by the Civil Division’s Commercial Litigation Branch; the U.S. Attorneys’ Offices for the Middle District of Florida, District of Columbia, Middle District of Tennessee and Eastern District of Pennsylvania; the FBI; the U.S. Department of Health and Human Services (HHS) Office of Inspector General; the VA OIG and the Department of Defense Criminal Investigative Service.
Shire, which cooperated in the government’s investigation, has been operating under a Corporate Integrity Agreement entered into with HHS that was implemented in late 2014, after the alleged unlawful conduct resolved by today’s settlement occurred, in connection with the settlement of separate False Claims Act allegations.
“Patients must be able to trust that decisions made by their doctors are based on unbiased professional judgment and not personal gain,” said Chief Counsel Gregory E. Demske to the HHS Inspector General. “The Office of the Inspector General will continue to monitor Shire’s compliance with federal healthcare programs through its oversight of Shire’s Corporate Integrity Agreement.”
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $31.4 billion through False Claims Act cases, with nearly $19.6 billion of that amount recovered in cases involving fraud against federal health care programs.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Shelton Man Sentenced to 46 Months in Federal Prison for Distributing Heroin to Overdose VictimRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that that JORGE MORALES, also known as “Capone,” 30, of Shelton, was sentenced today by U.S. District Judge Victor A. Bolden in Bridgeport to 46 months of imprisonment, followed by three years of supervised release, for distributing heroin. Judge Bolden also ordered MORALES to serve the first six months of supervised release in home confinement.
This matter stems from an ongoing statewide initiative targeting narcotics dealers who distribute heroin, fentanyl or opioids that cause death or serious injury to users.
According to court documents and statements made in court, on April 15, 2016, a 21-year-old woman was found unresponsive at her Bridgeport residence and was transported to the hospital. She has since died. Bridgeport Police recovered two baggies of suspected heroin packaged in glassine baggies from the bed next to where the victim was located. The baggies were marked with a particular brand stamp. A cellular telephone seized from the victim revealed numerous calls and text messages between the victim and MORALES in the days leading up the victim’s overdose.
On April 15, 2016, law enforcement conducted a controlled purchase of heroin, in baggies marked with the same brand stamp, from MORALES.
MORALES has been detained since his arrest on April 20, 2016. On July 13, 2016, he pleaded guilty to one count of possession with intent to distribute, and distribution of, heroin.
This investigation was conducted by the Drug Enforcement Administration’s New Haven Tactical Diversion Squad with the assistance of the Bridgeport, Derby, Shelton, Monroe, Middlebury and Woodbridge Police Departments. The Tactical Diversion Squad includes participants from the New Haven, Hamden, Greenwich, Shelton, Bristol, Vernon, Wilton, Milford, Monroe, Fairfield and Manchester Police Departments, and the Connecticut State Police. This case was prosecuted by Assistant U.S. Attorney Robert M. Spector.
Second Mesa Man Sentenced to Total of 90 Months for Domestic Violence OffensesRead the Press Release
PHOENIX – This week, Donovan Chaca, 38, of Second Mesa, Ariz., was sentenced by U.S. District Judge G. Murray Snow to 67 months of imprisonment, in addition to 23 months already served on related prosecutions in the Hopi Tribal Court. Chaca had previously pleaded guilty to assault resulting in substantial bodily injury to a dating partner and assault by strangling or suffocating a dating partner.
In August 2014 and January 2015, Chaca, who is a member of the Hopi Tribe, assaulted another member of the Hopi Tribe. The offenses occurred on the Hopi Indian Reservation in Hotevilla, Ariz.
The investigation in this case was conducted by the Federal Bureau of Investigation and the Bureau of Indian Affairs-Office of Justice Services (Hopi Agency). The prosecution was handled by Assistant U.S. Attorney Alexander Samuels, District of Arizona, Phoenix.
CASE NUMBER: CR-16-8005-PCT-GMS
RELEASE NUMBER: 2017-001_Chaca
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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.
Salinas Resident Sentenced to Four and A Half Years in Prison for Bank RobberyRead the Press Release
SAN JOSE – Jose Lemus was sentenced today to serve 54 months in prison for his role in an armed bank robbery, announced United States Attorney Brian J. Stretch and Federal Bureau of Investigation Special Agent in Charge John F. Bennett. The sentence, handed down today by the Honorable Lucy H. Koh, District Judge, follows a guilty plea in which Lemus admitted robbing the Castroville, Calif., branch of a federally-insured bank.
Lemus, 23, of Salinas, pleaded guilty on September 21, 2016, to one count of armed bank robbery and aiding and abetting. According to the plea agreement, on August 22, 2011, Lemus entered the Castroville branch of the bank with another man who was carrying a loaded semi-automatic handgun. Lemus and the other man both wore masks. Lemus admitted that while the other man remained in the lobby and pointed the handgun at customers and employees, Lemus jumped over the partition door that separated the lobby area from the tellers. Lemus went from teller station to teller station gathering money and placing it into a backpack. Lemus acknowledged that he and the other robber absconded with approximately $44,000 of the bank’s money.
On August 18, 2016, Lemus was charged in a one-count information with armed bank robbery, aiding and abetting, in violation of 18 U.S.C. §§ 2213 (a), (d), and 2. Pursuant to his plea agreement, Lemus pleaded guilty to the charge.
In addition to the prison term, Judge Koh also ordered Lemus to pay $42, 930.01 in restitution and to serve five years of supervised release. Lemus currently is in custody on state charges and will begin serving his sentence after the conclusion of his current state prison term.
Assistant U.S. Attorneys Stephen Meyer, Jeffrey Backhus, and Claudia Quiroz are prosecuting the case with the assistance of Ryka Bargi, Jessica Meegan, and Nina Burney Williams. The prosecution is the result of an investigation by the Federal Bureau of Investigation and the Monterey County Sheriff’s Office. The investigation was assisted by the Organized Crime Drug Enforcement Task Force, a focused multi-agency, multi-jurisdictional task force investigating and prosecuting the most significant drug trafficking and criminal organizations throughout the United States by leveraging the combined expertise of federal, state and local law enforcement agencies.
Rockford Man Indicted on Child Pornography ChargesRead the Press Release
ROCKFORD — A Rockford man was indicted yesterday by a federal grand jury on charges of child pornography.
PIERRE D. HAYES, 27, was charged with three counts of transporting child pornography via the internet in 2015.
Each count of transporting child pornography carries a mandatory minimum sentence of five years and a maximum of 20 years in prison, as well as a $250,000 maximum fine. If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and James M. Gibbons, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Chicago.
The government is represented by Assistant U.S. Attorney Monica V. Mallory.
Rochester Man Found Guilty of Lying on Application for Tsa Secure Airport IDRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y. – Acting U.S. Attorney James P. Kennedy, Jr. announced today that a federal jury has convicted Darnell Jerome, 20, of Rochester, NY, of making a false statement. The charge carries a maximum sentence of five years in prison and a fine of $250,000.
Assistant U.S. Attorneys Craig R. Gestring and Kyle P. Rossi, who handled the prosecution of the case, stated that the defendant applied for employment at a restaurant at the Greater Rochester International Airport. The restaurant was located in the sterile area of the airport, beyond the security screening zone. Because they have access to knives and other contraband items to which screened passengers do not, employees of the airport or contractors who work in the restaurants or stores inside the sterile area are required to obtain a special federal Security Identification Display Area (SIDA) badge and pass a federal background investigation, which includes a security threat assessment.
In March 2016, Jerome filled out a security clearance application and falsely reported that he had never been arrested. However, only a month before he falsified the SIDA clearance application form, Jerome was convicted of a felony, Robbery in the Second Degree, in Monroe County for which he was sentenced to five years’ probation. During that robbery, the defendant displayed what appeared to be a firearm.
Federal regulations put in place by the Department of Homeland Security since September 11, 2001, prohibit persons with certain disqualifying felony criminal convictions from obtaining a clearance to work at an airport. The defendant’s 2016 Robbery conviction, which is considered a crime of violence, was such a disqualifying offense. The security clearance application completed by the defendant clearly listed the specific disqualifying conditions on its face.
The verdict is the culmination of an investigation by the Federal Air Marshal Service, under the direction of Supervisory Air Marshal-in-Charge William Hall.Sentencing is scheduled for April 21, 2017, at 10:00 a.m. before Judge Elizabeth A. Wolford, who presided over the trial.
Prior Felon from Artesia Sentenced to Prison for Federal Narcotics Trafficking and Firearms ConvictionRead the Press Release
ALBUQUERQUE – Floyd Albert Sherrell, 34, of Artesia, N.M., was sentenced today in federal court in Las Cruces, N.M., to 57 months in prison followed by three years of supervised release for his conviction on methamphetamine trafficking and firearms charges.
Sherrell was arrested on Sept. 1, 2015, on an indictment charging him with unlawfully possessing firearms on June 10, 2014, and distributing methamphetamine on June 12, 2014. According to the indictment, Sherrell committed the crimes in Eddy County, N.M. At the time, Sherrell was prohibited from possessing firearms or ammunition because he previously had been convicted of larceny of a firearm and burglary.
On Jan. 26, 2016, Sherrell pled guilty to a felony information charging him with being a felon in possession of firearms and distribution of methamphetamine. In entering his guilty plea, Sherrell admitted selling four firearms to an undercover law enforcement agent on June 10, 2014, and selling 25 grams of pure methamphetamine to an undercover law enforcement agent on June 12, 2014.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Pecos Valley Drug Task Force and was prosecuted by Assistant U.S. Attorney Maria Y. Armijo of the U.S. Attorney’s Las Cruces Branch Office.
The Pecos Valley Drug Task Force is comprised of officers from the Eddy County Sheriff’s Office, Carlsbad Police Department and Artesia Police Department and is part of the HIDTA Region VI Drug Task Force. The High Intensity Drug Trafficking Areas (HIDTA) program was created by Congress with the Anti-Drug Abuse Act of 1988. HIDTA is a program of the White House Office of National Drug Control Policy (ONDCP) which provides assistance to federal, state, local and tribal law enforcement agencies operating in areas determined to be critical drug-trafficking regions of the United States and seeks to reduce drug trafficking and production by facilitating coordinated law enforcement activities and information sharing.
President of Office Equipment Leasing Company Sentenced to 4 Years in Prison for Multi-Million Dollar Fraud SchemeRead the Press Release
Earlier today, Michael Conway, the President of Choice Office Solutions LLC, was sentenced by United States District Judge William F. Kuntz to 4 years in prison. In February 2016, Conway had pleaded guilty to wire fraud in connection with a scheme where he forged numerous lease agreements to defraud an individual investor and De Lage Landen Financial Solutions Partner (DLLFSP) of more than $4.5 million. As part of the sentence, Conway was also ordered to pay $3,555,493.40 to the individual investor and $1,203,516 to DLLFSP in restitution.
The sentence was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
According to court filings and facts presented at the sentencing hearing, between March 2014 to August 2015, Conway forged lease agreements with various companies in the business of leasing office equipment, and then used these fraudulent agreements to obtain financing from private investors. As part of the scheme, he induced an individual investor to become partners with him in the leasing business. Conway would then purportedly secure a lease from a company, present the signed lease and invoices to the individual investor, who would provide funds to purchase the office equipment to be leased. In this manner, Conway presented the individual investor with leases from approximately 58 companies, including law firms, universities, hospitals, and hotels, and the individual investor paid Conway approximately $3.5 million to purchase office equipment. In reality, most of the leasing agreements that Conway provided to the individual investor were fraudulent, and Conway pocketed most of the individual investor’s money.
One of the fraudulent leasing agreements was purportedly with the New York Mets. Relying on it, the individual investor wire transferred approximately $500,000 to Conway’s bank account to purchase office equipment. Conway then used the same forged lease agreement, and a forged authorization letter from the New York Mets purportedly signed by Jeffrey Wilpon, the team’s Chief Operating Officer, to obtain financing from DLLFSP. Based on these fraudulent documents, DLLFSP wire transferred a total of approximately $313,000 to Conway’s bank account. Through this and other forgeries, Conway defrauded DLLFSP of more than $1 million.
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The government’s case is being prosecuted by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Winston Paes and David Pitluck are in charge of the prosecution.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit ww.StopFraud.gov.
The Defendant:
MICHAEL CONWAY
Age: 41
Verona, New Jersey
E.D.N.Y. Docket No. 16-CR-052 (WFK)
Orlando Man Convicted of Multiple Counts of Theft of Government Money and Aggravated Identity TheftRead the Press Release
Orlando, FL – United States Attorney A. Lee Bentley, III announces that a federal jury has found Manuel Enrique Santana (36, Orlando) guilty of 10 counts of theft of government money and 5 counts of aggravated identity theft. He faces a maximum penalty of 10 years in federal prison for each of the theft counts, to be followed by a mandatory term of at least 2 years for the aggravated identity theft charges. His sentencing hearing is scheduled for April 12, 2017. Santana was indicted on August 31, 2016.
According to evidence presented at trial, in early 2014, Santana deposited 47 stolen federal tax refund checks into 3 of his own bank accounts during a 10-day period. The majority of the checks were endorsed with forged signatures of the intended payees, all of whom had filed returns for the 2013 tax year and were expecting to receive their refund checks by mail. The combined value of the 47 stolen refund checks was more than $64,000.
This case was investigated by the United States Postal Inspection Service, the Internal Revenue Service - Criminal Investigation, and the Seminole County Sheriff’s Office. It is being prosecuted by Assistant United States Attorney Emily C. L. Chang.
Notice of Court ProceedingsRead the Press Release
Contact Person: Lance Crick (864) 282-2100
Columbia, South Carolina ---- United States Attorney Beth Drake announced today that a sentencing hearing has been set for Thursday, January 12, 2017, at 2:00 P.M. in the federal courthouse in Greenville in the case of the United States v. Melvin Boswell, Jr. Melvin Boswell, Jr., age 48, of Greenville, South Carolina, pled guilty on July 12, 2016, to conspiring to possess with the intent to distribute and to distribute five kilograms or more of cocaine and possessing firearms in furtherance of a drug trafficking crime.
Evidence presented by the government during the guilty plea hearing last year established that on August 20, 2015, Greenville Police Department Officers arrested Boswell at a business in Greenville County after Boswell removed his ankle monitor while on bond for other charges. While searching Boswell’s person and a rental car Boswell had driven to the business, police found: (1) 10 firearms (one of which was stolen); (2) numerous pieces of ammunition; (3) in excess of $70,000 worth of cocaine, crack cocaine, and heroin; (4) digital scales; and (5) in excess of $7000 in U.S. Currency. At the time Boswell possessed these items, he was a convicted felon.
Boswell was arrested during the initiation of “Operation Real-Time.” The goal of this program is to identify individuals for federal prosecution with significant criminal histories who continue to actively possess firearms in the Greenville community. In addition to GPD and ATF, Real Time’s core partners include the Greenville County Sheriff’s Office, the South Carolina Department of Probation, Parole, and Pardon Services, the South Carolina Highway Patrol, United States Probation, the Department of Homeland Security, the Federal Bureau of Investigation, the Drug Enforcement Administration, the 13th Circuit Solicitor’s Office, and the United States Attorney’s Office. Since August of 2015, the initiative has resulted in the expedited federal prosecution of some 70 defendants and seizure of approximately 100 firearms as well as assorted ammunition from prohibited persons.
Greenville Police Chief Ken Miller and his department were one of the first partners on board for this initiative. “This multi-agency partnership endeavors to keep our communities safe and reduce firearms violence through ‘real time’ identification of dangerous individuals who seek to disrupt our streets and communities with firearms-driven violence.”
U.S. Attorney Beth Drake commended the partnership between the state and federal agencies that led to the Bureau of Alcohol, Tobacco and Firearms and the U.S. Attorney’s Office picking the case up, “We work best when we work together. This ‘real time’ identification of high risk offenders is smart policing, and we welcome the opportunity to work alongside our state chiefs and sheriffs in taking violent repeat offenders out of our communities.”
The case was investigated by agents of the Drug Enforcement Administration working in conjunction with the Greenville Police Department and the Greenville County Sheriff’s Office. Assistant United States Attorney Andy Moorman of the Greenville office handled the case.
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North Carolina Man Sentenced on Check Fraud ChargesRead the Press Release
Lynchburg, VIRGINIA – A North Carolina man, who conspired with others to make money by cashing checks that had been stolen or altered, was sentenced last week in the United States District Court for the Western District of Virginia in Lynchburg, Acting United States Attorney Rick A. Mountcastle announced.
LaShawn Clinton, 39, of Mount Holly, North Carolina, previously pled guilty to one count of conspiracy to commit bank fraud and related offenses against the United States and two counts of aggravated identity theft. Last week in District Court, Clinton was sentenced to 85 months in federal prison.
According to evidence presented at previous hearings by Assistant United States Attorney Laura Day Rottenborn and Special Assistant United States Attorney Kari Munro, Clinton, and others he conspired with, agreed to help each other make money by cashing checks that were stolen and altered. Typically, members of the conspiracy, including Clinton, stole checks from the mail in and around business locations, including corporate office parks and other business districts.
Clinton, and other members of the conspiracy, altered the stolen checks, or caused them to be altered, to reflect a new payee name, and in some instances, an increased dollar amount. Members of the conspiracy used razor blades, erasers, typewriters and other tools to alter the checks. Clinton purchased and disposed of typewriters frequently in order to dispose of key evidence of his crimes.
In addition, Clinton and other members of the conspiracy, recruited individuals to cash the fraudulent checks at issuing banks. Typically the conspiracy used women for this role, however men were used as check cashers on occasion. The conspiracy primarily took place in the Western District of Virginia and Western District of North Carolina, however, members of the conspiracy did make check cashing trips to locations as far away as Pennsylvania, Missouri and Tennessee.
The investigation of the case was conducted by the United States Postal Inspection Service, the Franklin County Sheriff’s Office, the Bedford County Sheriff’s Office and the Mount Holly, North Carolina Police Department. Assistant United States Attorney Laura Day Rottenborn and Special Assistant United States Attorney Kari Munro prosecuted the case for the United States.
North Carolina Man Sentenced to 262 Months for Enticing Boyle County Minor to Engage in Sexually Explicit ConductRead the Press Release
LEXINGTON, Ky. – A North Carolina man, previously convicted of enticing a minor in Danville, Ky., to engage in sexually explicit conduct, was sentenced on Tuesday to 262 months in federal prison.
U.S. District Judge Danny C. Reeves sentenced James Matthew Shelton, 30, and also ordered him to serve a lifetime term of supervised release following the completion of his sentence. Under federal law, Shelton must serve at least 85 percent of his prison sentence.
Shelton admitted at his guilty plea that, from July 1, 2014 to August 23, 2014, he persuaded a 13-year-old female in Danville to send sexually explicit photos of herself to his cell phone.
In April of 2015 an investigator with the Office of the Kentucky Attorney General, and other law enforcement agents, executed a search warrant at Shelton’s residence in North Carolina and seized his cell phone. The phone contained images of child pornography. The investigation started in September of 2014, when the Boyle County Sheriff’s Office received a complaint that Shelton had threatened one or more minors in Boyle County.
Kerry B. Harvey, United States Attorney for the Eastern District of Kentucky; Amy Hess, Special Agent in Charge, FBI; Andy Beshear, Attorney General of Kentucky; and Derek Robbins, Boyle County Sheriff, jointly made the announcement.
The investigation was conducted by the FBI, the Office of the Kentucky Attorney General, and the Boyle County Sheriff’s Office.
New York Resident Pleads Guilty in South Florida to Money Laundering Conspiracy Involving Stolen Identity Tax Fraud and Recreational Vehicles Fraud SchemesRead the Press Release
A New York resident pled guilty for his participation in a money laundering conspiracy involving stolen identity tax fraud and a recreational vehicles fraud scheme.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.
Marlen Manukyan, 41, of Brooklyn, New York, pled guilty to one count of conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956(h). As part of his plea agreement, Manukyan agreed to restitution in the amount of $124,009.
According to court documents, from August to November 2013, Manukyan opened bank accounts using counterfeit driver's licenses that he knew would be used to conduct financial transactions involving funds derived from unlawful activities. Specifically, from August 1, 2013 to August 9, 2013, Manukyan opened multiple bank accounts using the identities of two individuals without their permission using counterfeit Pennsylvania Driver's Licenses. These accounts received money from two illicit sources for the next several months.
First, Manukyan's co-conspirators filed fraudulent tax returns with the IRS using the stolen identities of various individual taxpayers without the taxpayers' knowledge or consent. The fraudulent tax refunds (minus fees) were sent to several of the bank accounts that were set-up by the defendant. Co-conspirators then withdrew the money through cash withdrawals or debit card transactions. In total, Manukyan's co-conspirators filed approximately 71 fraudulent tax returns with the IRS.
Second, Manukyan's co-conspirators engaged in a scheme to defraud individuals who were seeking to buy used recreational vehicles (RVs) on the internet. To perpetrate this scheme, the defendant's co-conspirators used fake names and advertised on internet websites that they had used RVs for sale. Interested purchasers were told to send their money by wire transfer to a bank account in the name of a shell company that Manukyan opened using a counterfeit driver's license. Specifically, a retired couple was defrauded into believing that they had reached an agreement to purchase a used RV. The individuals sent $39,960 by wire transfer to complete the purchase, but the couple never received the RV and the co-conspirators ceased communicating with the victims once they received the money. The defendant and his co-conspirators caused the bank to send $39,000 by international wire transfer from the shell company’s bank account to a bank account in the name of another individual in Moscow, Russia.
Manukyan is scheduled to be sentenced on March 16, 2017, before United States District Judge Darrin P. Gayles. At sentencing, the defendant faces up to twenty years in prison.
Mr. Ferrer commended the investigative efforts of the FBI and IRS-CI. This case is being prosecuted by Assistant U.S. Attorney Harold E. Schimkat.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
New York Man Sentenced to 20 Years in Prison for Robbing Bergen County BankRead the Press Release
NEWARK, N.J. – A Brooklyn, New York, man who was on the FBI’s 10 Most Wanted Fugitive List in 1988 was sentenced today to 240 months in prison for robbing a TD Bank in Oakland, New Jersey, in April 2013, U.S. Attorney Paul J. Fishman announced.
John Edward Stevens, 63, previously pleaded guilty before U.S. District Judge Claire C. Cecchi to Count Two of an indictment charging him with armed bank robbery. Judge Cecchi imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Stevens admitted that on April 15, 2013, he robbed a TD Bank in Oakland. After entering the bank, Stevens approached several bank employees while carrying a zipper pouch. He opened the zipper pouch, pulled out what appeared to be a black handgun, and brandished it at one of the bank employees. He then took several thousand dollars in cash and fled the scene.
Approximately 20 minutes after the robbery, law enforcement stopped a vehicle that was reported stolen. The driver of the stolen vehicle was identified as Stevens. Law enforcement arrested Stevens and located a TD Bank bag filled with money in the vehicle.
Stevens has been convicted of at least eight prior armed bank robberies in the Central District of California and the Southern District of Ohio.
In addition to the prison term, Judge Cecchi sentenced Stevens to three years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to today’s plea. He also thanked the Waldwick Police Department, the Oakland Police Department, the Ho-Ho-Kus Police Department and the Bergen County Sheriff’s Office for their contributions to the case.
The government is represented by Assistant U.S. Attorney Melissa Wangenheim of the Criminal Division in Newark.
Defense counsel: Lorraine Gauli-Rufo Esq., Verona, New JerseyNew Orleans Man Pleads Guilty to Possession of Child Pornography and Failure to Register as a Sex OffenderRead the Press Release
U.S. Attorney Kenneth A. Polite announced that DWIGHT JOSEPH, JR., age 34, of New Orleans, pled guilty today to a two-count Indictment charging him with possession of images and videos depicting the sexual exploitation of children under the age of twelve and failure to register as a sex offender.
According to court documents, JOSEPH was convicted in 2005 in Lehigh County, Pennsylvania, for dissemination of photo/film of child sex acts, which required him to register as sex offender for at least ten years. Notwithstanding that obligation, JOSEPH temporarily resided in New Orleans beginning in about April 2015, without notifying the appropriate authorities in either Louisiana or Pennsylvania.
Additionally, on about September 9, 2015, law enforcement authorities executed a search warrant at JOSEPH’S residence, during which time they seized numerous electronic items. A forensic examination of the device revealed that JOSEPH used the devices to download and save images and videos of children as young as less than one-year old engaging in sexually explicit conduct, including being raped, forced to perform oral sex on adult men, and being forced to engage in acts of incest. The forensic examination located approximately 725 images and 69 videos depicting prepubescent children engaging in sexually explicit on JOSEPH’S digital devices.
JOSEPH faces a mandatory minimum of 10 years imprisonment and a maximum term of imprisonment of 20 years for possessing child pornography. He also faces a maximum term of 10 years imprisonment for failing to register as sex offender. Additionally, JOSEPH faces up to a lifetime of supervised release and a $250,000 fine per count. He can also be required to register as a sex offender. U.S. District Judge Sarah S. Vance set sentencing for May 17, 2017.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys= Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
U.S. Attorney Polite praised the work of the Louisiana Bureau of Investigation Cyber Crime Unit and the United States Marshals Service, with assistance from the United States Department of Homeland Security – Homeland Security Investigations in investigating this matter. Assistant United States Attorney Jordan Ginsberg is in charge of the prosecution.
Montana Couple Pleads Guilty to Conspiring to Defraud the United StatesRead the Press Release
A Montana couple pleaded guilty today in federal court in Missoula, Montana to one count of conspiracy to defraud the United States, announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division, and U.S. Attorney Michael W. Cotter for the District of Montana.
According to the government’s offer of proof, Peggy DeYoung and John DeYoung, both 71, have not filed an individual income tax return since 1998. From 2007 through 2011, Peggy DeYoung earned income through her ownership interest in two companies that own Southern California mobile home parks. The DeYoungs also enlisted the services of Joseph Hill of Creative Consulting Group to establish a number of purported trusts. The DeYoungs opened bank accounts in the names of those trusts using fabricated taxpayer identification numbers and paid personal expenses from the accounts. The plea agreement specifies that the DeYoungs caused the U.S. Treasury a tax loss of $376,350.
Sentencing is scheduled for April 21. The DeYoungs face a statutory maximum sentence of five years in prison, a period of supervised release, restitution and monetary penalties.
Principal Deputy Assistant Attorney General Ciraolo and U.S. Attorney Cotter thanked special agents of IRS–Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Chad Spraker and Trial Attorney Rebecca Sable of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Michigan Man Sentenced to Prison ForRead the Press Release
Troy Mitchell McCormick, 51, of Commerce Township, Michigan, was sentenced yesterday to serve 46 months in prison, announced Jack Smith, Acting United States Attorney for the administration of this case. U.S. District Court Judge Marvin E. Aspen also sentenced McCormick to serve 3 years of supervised release and to pay restitution of $107,586.
In March 2016 McCormick pleaded guilty to mail fraud and wire fraud. These charges arose from his conduct while employed as a sales representative and vice president for Emdeon, a Nashville, Tenn. based company that provided services to hospitals and health systems. McCormick admitted that he fraudulently fabricated contracts between his employer and certain customers, including a non-profit hospital, a non-profit hospital system, and the University of Michigan, and that he forged signatures on these contracts. As a result of McCormick’s forged contracts, these customers were billed inflated amounts, and McCormick received $107,586 in additional incentive compensation.
This case was investigated by the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorneys Cecil W. VanDevender and William F. Abely.
Mexican National Sentenced for Trafficking Multiple DrugsRead the Press Release
McALLEN, Texas – A Mexican man who had been residing in Pasadena has been ordered to prison for importing methamphetamine, cocaine and heroin into the United States from Mexico, announced U.S. Attorney Kenneth Magidson. Gustavo Rivera-Morales pleaded guilty Jan. 28, 2016.
Today, U.S. District Judge Randy Crane ordered Rivera-Morales to serve 72 months in federal prison. He is expected to face deportation proceedings following his release from prison.
At the time of his guilty plea, Rivera-Morales admitted that on Nov. 30, 2015, he had driven a vehicle from Mexico into the United States through the Pharr port of entry, knowing the vehicle contained a controlled substance. Upon inspection, Customs and Border Protection (CBP) officers discovered methamphetamine, cocaine and heroin hidden within the passenger and driver side rear panels of the vehicle. Agents seized numerous bricks of drugs weighing approximately 18 kilograms of methamphetamine, four kilograms of cocaine and three kilograms of heroin.
Rivera has been in custody without bond since his arrest in November 2015 where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Immigration and Customs Enforcement’s Homeland Security Investigations and CBP conducted the investigation. Assistant U.S. Attorney Linda Requénez prosecuted the case.
Masters of Cosmetology ChargeRead the Press Release
FORT WAYNE – The United States Attorney for the Northern District of Indiana, David Capp, announced that an information was filed charging Rachel Crawford, 38, of Fort Wayne, Indiana, with obtaining by fraud and materially false statements, federal financial funds within the jurisdiction of the United States Department of Education. The Department of Education provides certain funding through Family Federal Education Loans (FFEL), a program administered by Sallie Mae. This charge relates to Crawford’s actions when she was the financial aid director at Masters of Cosmetology.
In conjunction with this information, Crawford has entered into an agreement wherein she will plead guilty to the charge.
The United States Attorney’s Office advised that Crawford has cooperated with this investigation throughout. This investigation led to the earlier conviction of Kaydean Geist, owner of Masters of Cosmetology.
As part of this overall investigation, the Department of Education agreed to cancel certain FFEL loans through Sallie Mae that were illegally acquired by Masters of Cosmetology, thereby relieving many students from loans that should never have been authorized by Masters of Cosmetology.
The above charge and plea concludes the matter regarding the financial irregularities regarding the Masters of Cosmetology School. Crawford will appear in court for her change of plea hearing before Magistrate Judge Susan Collins at a future date.
The United States Attorney's Office emphasized that an Information is merely an allegation and that all persons charged are presumed innocent until, and unless, proven guilty in court.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
This investigation was conducted by the Federal Bureau of Investigation, Indiana State Police and the United States Department of Education-Office of Inspector General. This case was handled by Assistant United States Attorney Tina L. Nommay.
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Lincoln County Man Pleads Guilty to Federal Meth Trafficking ChargesRead the Press Release
ALBUQUERQUE – Octavio Herrera, 54, of Ruidoso Downs, N.M., pled guilty today in federal court in Las Cruces, N.M., to methamphetamine trafficking charges.
Herrera was one of 34 individuals charged in December 2015, with federal and tribal drug offenses as the result of an 18-month multi-agency investigation led by the DEA and BIA into methamphetamine trafficking on the Mescalero Apache Reservation. Eighteen defendants, including five members of the Mescalero Apache Tribe and 13 non-Natives were charged in six federal indictments and a federal criminal complaint. Sixteen other members of the Mescalero Apache Tribe were charged in tribal criminal complaints approved by the Mescalero Apache Tribal Court.
The investigation leading to the federal and tribal charges was initiated in May 2014, in response to an increase in violent crime on the Mescalero Apache Reservation perpetrated by methamphetamine users. The investigation initially targeted a drug trafficking organization that was allegedly distributing methamphetamine within the Reservation, and later expanded to include two other drug trafficking organizations in southeastern New Mexico that allegedly served as sources of supply for the methamphetamine distributed within the Reservation. In Aug. 2014, the investigation was designated as part of the Justice Department’s Organized Crime Drug Enforcement Task Force (OCDETF) program, which combines the resources and unique expertise of federal agencies, along with their local counterparts, in a coordinated effort to disrupt and dismantle major drug trafficking organizations. The investigation is one of the first OCDETF investigations to utilize electronic surveillance (wiretaps) in Indian Country. More than ten kilograms of methamphetamine were seized during the course of the investigation.
Herrera was arrested in Sept. 2016, on an indictment charging him and his co-defendants Rumaldo Varela Enriquez, 46, a Mexican national and Johnny Flowers, 51, of Hobbs, with methamphetamine trafficking offenses. The indictment charged Herrera with participation in a methamphetamine trafficking conspiracy, possession of methamphetamine with intent to distribute, and use of a communication facility in relation to a drug trafficking crime.
During today’s proceedings, Herrera pled guilty to conspiracy and possession of methamphetamine with intent to distribute. In entering the guilty plea, Herrera admitted that between March 4, 2015 and March 12, 2015, he conspired with others to distribute methamphetamine in Hobbs and Lovington, N.M. Herrera also admitted that on March 12, 2015, he possessed 230.1 grams of methamphetamine which he intended to distribute to others. At sentencing, Herrera faces a statutory mandatory minimum penalty of five years and a maximum of 40 years. A sentencing hearing has yet to be scheduled.
Seventeen of the 18 federal defendants including Herrera’s co-defendants have entered guilty pleas. The remaining federal defendant has entered a not guilty plea. Charges in indictments are merely accusations and defendants are presumed innocent unless found guilty in a court of law.
The federal and tribal cases were investigated by the Las Cruces office of the DEA, District IV of the BIA’s Office of Justice Services (Mescalero Agency), BIA’s Division of Drug Enforcement, Mescalero Tribal Police Department, Hatch Police Department, FBI and Lea County Drug Task Force. Assistant U.S. Attorneys Terri J. Abernathy and Clara Cobos of the U.S. Attorney’s Las Cruces Branch Office are prosecuting the federal cases, and Mescalero Tribal Prosecutor Melissa Chavez is prosecuting the tribal cases.
Leader of Drug Trafficking Ring Sentenced to Life for Distributing Fentanyl That Caused Overdose Death of Madison County ManRead the Press Release
Case represents first time in eastern Kentucky that a life sentence was imposed as a result of
an overdose of fentanyl and that federal overdose penalties were applied to out-of-state
defendants from Detroit, a major source for illicit drugs
LEXINGTON, Ky. — The leader of a drug trafficking organization that brought significant amounts of heroin and fentanyl, from Detroit, Mich., to Richmond, Ky., has been sentenced to life imprisonment for distributing fentanyl that resulted in the overdose death of a Madison County resident.
On Monday, U.S. District Judge Danny Reeves sentenced Navarius Westberry, 38, originally from Michigan, but living in Lexington, for distributing a controlled substance resulting in an overdose death. Anyone convicted under this law is subject to a prison term of 20 years to life. After an extensive hearing, the Court imposed a term of life imprisonment.
“The facts of this case are particularly disturbing,” said Kerry B. Harvey, United States Attorney for the Eastern District of Kentucky. “Mr. Westberry and his co-conspirators moved to Kentucky from Michigan for the sole purpose of establishing a large scale distribution network for heroin and fentanyl. The organization which he led was among the first to introduce large quantities of fentanyl to the Richmond community. The drugs sold by the Westberry organization caused multiple overdoses, including fatalities. The evidence indicates that Mr. Westberry knew the drugs sold by his organization were particularly dangerous. Mr. Westberry exhibited a callous disregard for human life in his quest for easy money. The Court determined that his freedom must be forever forfeited as a result of his criminal conduct. I hope that those inclined toward this sort of destructive conduct, whether they live in Kentucky or occupy a higher position in the drug distribution network, take heed – the people of Kentucky have had enough. The drugs you are peddling will kill people and the price you will pay for that is steep – whether ether you are the street level dealer, or a leader of the criminal organization.”
Westberry admitted that, from January 2014 until August 2015, he organized and operated a drug trafficking organization in Richmond that distributed between 750 grams and one kilogram of heroin and 50 grams of fentanyl. Fentanyl, which is many times stronger than heroin, can be lethal in the 2 mg range.
Westberry also admitted that, in March 2015, he supplied heroin and fentanyl to others, which then led to the overdose death of 25 year-old Cory Brewer. The toxicology report and autopsy showed that Brewer’s death was caused by toxic levels of fentanyl.
This case marks the first time in the Eastern District of Kentucky that the federal overdose penalties were applied in a case involving defendants from Michigan, whose distribution of drugs in Kentucky caused an overdose.
Four other co-conspirators have pleaded guilty and been sentenced, including co-defendant, Benjamin Fredrick Charles Robinson, 21, also from Detroit, who was sentenced to 20 years for distributing a controlled substance that caused another overdose. In that case, the victim survived due to medical assistance.
U.S. Attorney Harvey; Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration; and James Ebert, Chief of Police, Richmond Police Department, jointly made the announcement.
The investigation was conducted by the DEA and the Richmond Police. Assistant U.S. Attorney Todd Bradbury prosecuted this case on behalf of the federal government.
Latin King Gang Leader Sentenced for Illegal Gun Possession and Drug TraffickingRead the Press Release
BOSTON – A member of the Latin Kings man was sentenced yesterday in U.S. District Court in Boston for drug and gun possession.
Luis Lopez, 31, of New Bedford, was sentenced by U.S. District Court Judge Rickard G. Stearns to 15 years in prison and three years of supervised release. In October 2016, Lopez pleaded guilty to one count of being a felon in possession of a firearm and one count of possession with intent to distribute heroin.
The police sought and received a search warrant for Lopez’s residence in New Bedford, where approximately $2,000, cell phones, a digital scale, packaging materials, heroin and a Glock 9mm handgun with 16 rounds of ammunition were recovered.
Lopez has previously been convicted of drug dealing and committing violent crimes. Lopez is also an alleged Latin King gang leader, which, among other things, is evidenced by tattoos that adorn his face, including a Latin Kings crown and “shoot to kill.”
United States Attorney Carmen M. Ortiz; Mickey D. Leadingham, Special Agent in Charge of the Bureau of Alcohol, Tobacco and Firearms, & Explosives, Boston Field Division; New Bedford Police Chief Joseph B. Cordeiro; and Bristol County District Attorney Thomas Quinn, made the announcement. Assistant U.S. Attorney Glenn A. MacKinlay of Ortiz’s Organized Crime and Gang Unit prosecuted the case.
Justice Department Seeks to Shut Down Florida and North Carolina Tax Return PreparersRead the Press Release
The owners and operators of the tax return preparation businesses Q A Tax Service Inc., Unik Tax Refund, D&M Tax Solutions, LED Tax Services, and UJM Tax Services prepare false tax returns, according to three separate civil suits filed by the United States. The government seeks court orders barring the owners and operators of these businesses from preparing tax returns for others and owning and operating a tax return preparation business. The government also requests court orders requiring these owners and operators to disgorge the gross receipts they obtained from the preparation of federal tax returns that make, among other things, false claims.
The government filed the first of these three suits, in federal court in Orlando, Florida, against two of the owners and operators of Q A Tax Service Inc., Vicky Barwick of Orlando, Florida and Jasmine Morales of Winter Garden, Florida. According to that complaint, Q A Tax Service Inc. has store locations in Florida, Illinois, Indiana, and North Carolina. The government filed the second of these suits, in federal court in Fayetteville, North Carolina, against another owner and operator of Q A Tax Service Inc., Tanisha Salmon of Fayetteville.
The government filed the third suit, in federal court in Orlando, Florida, against the owners and operators of the following tax return preparation businesses, each of which has locations in Florida:
- Unik Tax Refund LLC – Yves Demesmin of Mt. Dora, Florida;
- UJM Tax Services LLC – Joseph Demesmin of Boca Raton, Florida;
- LED Tax Services – Elie Dorceus of Boynton Beach, Florida; and
- D&M Tax Solutions – Mario Cooper and Dia Fleming of Palm Coast, Florida.
In these complaints, the government alleges that Barwick, Morales, Salmon, Yves Demesmin, Joseph Demesmin, Dorceus, Cooper, and Fleming (the defendants) each use, in their respective businesses, a model previously used by the tax return preparation business formerly known as LBS Tax Services. Since 2014, the United States has sued nearly a dozen former LBS franchisees and managers and obtained court orders requiring these individuals to disgorge millions of dollars in fees, in addition to barring these individuals from owning and operating a tax return preparation business and from preparing tax returns for others.
The government alleges in its complaints that the defendants used the LBS model to prepare and file false tax returns to fraudulently increase their customers’ refunds and profit through exorbitant and often undisclosed fees—all at the expense of their customers and the U.S. Treasury. Specifically, the complaints allege that the defendants engage in fraudulent activity, including:
- Falsely claiming the Earned Income Tax Credit;
- Fabricating businesses and related business income and expenses;
- Fabricating deductions, particularly for unreimbursed employee business expenses; and
- Charging deceptive and unconscionable fees.
The Internal Revenue Service (IRS) is reminding taxpayers that the 2017 individual income tax return filing season begins Jan. 23, and there is information available on the IRS’s website. Return preparer fraud was one of the IRS’s Dirty Dozen Tax Scams for 2016 and taxpayers seeking a return preparer should remain vigilant. The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Justice Department Files Voting Rights Suit Against City of Eastpointe, MichiganRead the Press Release
The Justice Department filed a lawsuit yesterday to challenge the at-large method of electing the city council of Eastpointe, Michigan. The complaint alleges that the election system in Eastpointe violates Section 2 of the Voting Rights Act by denying black citizens in the city the equal opportunity to elect representatives of their choice.
The lawsuit, filed in the U.S. District Court for the Eastern District of Michigan, follows an extensive review of the city’s electoral practices, history and current conditions, guided by extensive precedent applying Section 2 of the Voting Rights Act. Among other important factors highlighted in the case law, the lawsuit alleges that Eastpointe has racially polarized voting patterns, with white voters consistently opposing and defeating the preferred candidates of Eastpointe’s sizable black community. Although black residents comprise roughly one-third of the electorate and consistently support black candidates for local office, no black individual has ever served on the Eastpointe City Council. With Eastpointe’s current system, voting patterns combined with other local factors dilute the black community’s voice and lead to a discriminatory result.
The complaint also alleges that changing the method of voting – for example, by electing each councilmember from a district – could create an equitable opportunity for black voters to elect a candidate of their choice to the Eastpointe City Council. The lawsuit seeks a federal court order implementing a new method of electing the Eastpointe City Council.
“Federal law seeks to protect diverse communities from discriminatory systems that weaken the power of the franchise,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “The Justice Department hopes to work cooperatively with Eastpointe to ensure that all communities enjoy equitable opportunity in our elections.”
“Section 2 of the Voting Rights Act prohibits practices such as Eastpointe’s at-large City Council system where they improperly dilute the ability of citizens to elect the candidates of their choice,” said U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan. “We filed this lawsuit to ensure that all voters in Eastpointe have a fair opportunity to participate in their local government.”
The Justice Department continues to have positive discussions with the city of Eastpointe and remains hopeful that a settlement will be reached. As Eastpointe’s next regularly scheduled city council election is set for November 2017, the department’s filing was necessary to preserve the ability of a court to hear this case in a timely manner.
Complaints about discriminatory voting practices may be reported to the Civil Rights Division’s Voting Section at 1-800-253-3931. More information about the Voting Rights Act and other federal voting laws is available on the Justice Department’s website at www.justice.gov/crt/voting.
Justice Department Files Voting Rights Suit Against City of Eastpointe, MichiganRead the Press Release
The Justice Department filed a lawsuit late yesterday to challenge the at-large method of electing the city council of Eastpointe, Michigan. The complaint alleges that the election system in Eastpointe violates Section 2 of the Voting Rights Act by denying black citizens in the city the equal opportunity to elect representatives of their choice.
The lawsuit, filed in the U.S. District Court for the Eastern District of Michigan, follows an extensive review of the city’s electoral practices, history and current conditions, guided by extensive precedent applying Section 2 of the Voting Rights Act. Among other important factors highlighted in the case law, the lawsuit alleges that Eastpointe has racially polarized voting patterns, with white voters consistently opposing and defeating the preferred candidates of Eastpointe’s sizable black community. Although black residents comprise roughly one-third of the electorate and consistently support black candidates for local office, no black individual has ever served on the Eastpointe City Council. With Eastpointe’s current system, voting patterns combined with other local factors dilute the black community’s voice and lead to a discriminatory result.
The complaint also alleges that changing the method of voting – for example, by electing each councilmember from a district – could create an equitable opportunity for black voters to elect a candidate of their choice to the Eastpointe City Council. The lawsuit seeks a federal court order implementing a new method of electing the Eastpointe City Council.
“Federal law seeks to protect diverse communities from discriminatory systems that weaken the power of the franchise,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “The Justice Department hopes to work cooperatively with Eastpointe to ensure that all communities enjoy equitable opportunity in our elections.”
“Section 2 of the Voting Rights Act prohibits practices such as Eastpointe’s at-large City Council system where they improperly dilute the ability of citizens to elect the candidates of their choice,” said U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan. “We filed this lawsuit to ensure that all voters in Eastpointe have a fair opportunity to participate in their local government.”
The Justice Department continues to have positive discussions with the city of Eastpointe and remains hopeful that a settlement will be reached. As Eastpointe’s next regularly scheduled city council election is set for November 2017, the department’s filing was necessary to preserve the ability of a court to hear this case in a timely manner.
Complaints about discriminatory voting practices may be reported to the Civil Rights Division’s Voting Section at 1-800-253-3931. More information about the Voting Rights Act and other federal voting laws is available on the Justice Department’s website at www.justice.gov/crt/voting.
Eastpointe ComplaintJury Finds Postal Employee Guilty of Theft of More Than $2 Million in Social Security Checks from MailRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury today found Stacy Darnell Mitchell (48, Tampa) guilty of theft of government property and theft of mail. He faces a maximum penalty of 15 years in federal prison. His sentencing date has not yet been set. Mitchell was indicted on March 1, 2016.
According to evidence presented at trial, Mitchell was a mail handler who had worked for more than 15 years at the Processing and Distribution Center (PDC) in St. Petersburg, which processes mail for all of Pinellas County. From January to October 2012, Mitchell stole Social Security benefit checks totaling over $2 million from that facility. More than 3,000 checks were taken from the PDC in 2012, all of which were destined for disabled or retired beneficiaries living in Pinellas County. Mitchell went on to sell the checks to an accomplice in Tampa, who in turn sold the checks to a network of individuals to be cashed at various convenience stores and check cashing businesses in Florida and elsewhere. Four of Mitchell’s accomplices have been convicted of federal charges related to the same theft scheme.
This case was investigated by the United States Postal Service – Office of Inspector General, the Social Security Administration - Office of Inspector the General, the United States Department of Treasury - Office of Inspector General, and the United States Postal Inspection Service, as well as various local enforcement agencies. It is being prosecuted by Assistant United States Attorney Patrick Scruggs.
Jackson County Man Sentenced for Methamphetamine OffensesRead the Press Release
On January 11, 2017, Charles W. Yearian, a/k/a "Chuckie," 40, of Murphysboro, was sentenced to federal prison for methamphetamine offenses, Donald S. Boyce, United States Attorney for the Southern District of Illinois, announced today.
Yearian, who had previously pled guilty to a second superseding indictment charging him with one count of conspiracy to manufacture and distribute methamphetamine and one count of possession of pseudoephedrine knowing that it would be used to manufacture methamphetamine, was sentenced to 144 months of imprisonment, 3 years of supervised release, and was fined $400.00. Evidence at the plea and sentencing hearings established that Yearian was involved with numerous other persons in the manufacture of methamphetamine and the distribution of ice in Jackson and Perry Counties. Ice is methamphetamine which has a purity level of at least 80%. On multiple occasions in December 2015 and January 2016, Yearian sold methamphetamine to a confidential source working for law enforcement. At sentencing, the District Court found that Yearian was responsible for the possession of 328.8 grams of pseudoephedrine and the distribution of 85.62 grams of ice. Four co-defendants have pled guilty and are awaiting sentencing in this case. Two co-defendants have pled not guilty and are awaiting a January 30, 2017, jury trial.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Murphysboro Police Department, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. The Union County Sheriff’s Office, Jackson County States Attorney’s Office, and DuQuoin Police Department also assisted in the investigation.
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Investment Bank Director Sentenced for Insider TradingRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that STEVEN MCCLATCHEY, a director at an investment bank in Manhattan (the “Investment Bank”), was sentenced today to five months in prison on securities fraud and wire fraud charges in connection with his provision of inside information used to trade in the stock of several companies. MCCLATCHEY pled guilty on July 12, 2016, and was sentenced today by United States District Judge Katherine Polk Failla.
According to the Complaint, Information, and statements made during court proceedings:
From in or about February 2014 through in or about September 2015, MCCLATCHEY and Gary Pusey participated in a scheme to commit insider trading in advance of and in connection with more than 10 separate mergers and acquisitions. MCCLATCHEY and Pusey were close friends who owned boats docked in a Long Island marina and who spent most Saturdays on their boats, at the marina, or playing pool and watching sports in MCCLATCHEY’s garage.
MCCLATCHEY learned about the deals as part of his employment with the Investment Bank, which generally advised either (i) the company to be acquired in the transaction; (ii) the acquiring company; or (iii) a company that ultimately lost a bid to acquire the company involved in the transaction.
Having learned the inside information about these impending transactions, MCCLATCHEY, in breach of fiduciary duties and other duties of trust and confidence owed to the Investment Bank and its clients, tipped Pusey so that Pusey could use the information to trade and with the expectation that Pusey would confer a benefit upon MCCLATCHEY. Among the benefits that MCCLATCHEY received as part of the insider trading scheme were thousands of dollars of cash payments by Pusey and the provision of home renovation services.
Pusey used the Inside Information that he received from MCCLATCHEY to make profitable trades in, among other securities: Forest Oil Corporation, Questcor Pharmaceuticals, Inc., Zygo Corporation, Pepco Holdings, Inc., Measurement Specialties, Inc., Entropic Communications, Inc., PetSmart, Inc., Emulex Corporation, Omnicare, Inc., and TECO Energy, Inc. Pusey reaped approximately $76,000 in ill-gotten gains from this scheme.
* * *
In addition to the prison sentence, MCCLATCHEY, 58, was sentenced to two years of supervised release. The Court further ordered that MCCLATCHEY forfeit $76,000 and pay a fine of $10,000.
Mr. Bharara praised the work of the Federal Bureau of Investigation, and thanked the U.S. Securities Exchange Commission for its assistance.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Rebecca Mermelstein is in charge of the prosecution.
Indiana Man Indicted for Illegal FirearmRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that an Indiana man was indicted by a federal grand jury today for illegally possessing a firearm and ammunition.
Kristopher Shawn Martin, 34, of Brazil, Ind., was charged in a two-count indictment returned by a federal grand jury in Jefferson City, Mo.
Today’s indictment alleges that Martin was in possession of a loaded Browning .380-caliber handgun on Oct. 7, 2016, in Columbia, Mo. Martin is charged with one count of being a felon in possession of a firearm and ammunition, and one count of being an unlawful drug user in possession of a firearm and ammunition.
Under federal law, it is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. Martin has prior felony convictions for possessing cocaine, domestic battery and cruelty to animals.
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 Lawrence E. Miller. It was investigated by the Columbia, Mo., Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Houston Trucking Dispatcher Pleads Guilty to Defrauding Oklahoma City Company and is Sentenced to Serve 15 Months in Federal PrisonRead the Press Release
Oklahoma City, Oklahoma – Today RICHARD V. KELLY, 44, of Houston, Texas, pleaded guilty to wire fraud and was sentenced by United States District Judge Robin J. Cauthron to 15 months in federal prison for using a wire fraud scheme to defraud Oklahoma City company of more than $1.2 million in false billings, announced Mark A. Yancey, United States Attorney for the Western District of Oklahoma.
Kelly was indicted on December 8, 2015, and entered his plea of guilty today. According to court records and information from the plea hearing, Kelly admitted that from December 2007 through August 2012, while he worked as a trucking dispatcher for Freeway Delivery, Inc., in Houston, Texas, he defrauded customer Midwest Hose & Specialty, an Oklahoma City company. Kelly admitted that he created false waybills and invoices for fictitious deliveries purportedly made by his wife, a truck driver who was also employed by Freeway Delivery. Kelly admitted that the false waybills and invoices showed deliveries being made for Midwest Hose to Houma, Louisiana, but that he knew no such deliveries were made. Kelly also admitted that he knew Midwest Hose would pay those invoices and that his wife would then be paid 65 to 70 percent of the total fee charged by Freeway Delivery. Finally, Kelly admitted that he created those false documents to obtain money for deliveries that never happened.
Kelly was sentenced today by Judge Cauthron to serve 15 months in federal prison and ordered to pay restitution of $1,212,320.13 to Midwest Hose. The Court also entered a money judgment in the amount of $809,115.50, directing Kelly to forfeit that amount to the United States. Kelly must report to federal prison on February 13, 2017.
This case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorney K. McKenzie Anderson.
Friendship Man Pleads Guilty to Meth ChargeRead 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 Jordan R. Doane, 28, of Friendship, NY, pleaded guilty before U.S. District Court Judge Lawrence J. Vilardo to conspiracy to manufacture, possess with intent to distribute, and to distribute, 50 grams or more of a mixture and substance containing methamphetamine. The charge carries a minimum penalty of five years in prison and a maximum of 20 years, and a $5,000,000 fine.
Assistant U.S. Attorney Brendan T. Cullinane, who is handling the case, stated that between January of 2011 and November of 2012, the defendant conspired to manufacture and distribute methamphetamine. Doane engaged in the practice of “smurfing” (buying small quantities) at local pharmacies to get around restrictions on purchasing products containing pseudoephedrine, an important chemical necessary in the methamphetamine manufacturing process.
The conviction is the culmination of an investigation on the part of the Drug Enforcement Administration, under the direction of Special Agent-in-Charge James J. Hunt, New York Field Division; the New York State Police Community Narcotics Enforcement Team (CNET), under the direction of Lieutenant Kevin Reyes and Major David Krause; the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent-in-Charge Ashan Benedict, New York Division; the Southern Tier Regional Drug Task Force, under the direction of Cattaraugus County Sheriff Timothy Whitcomb; the Wellsville Police Department, under the direction of Chief Timothy O’Grady; the U.S. Border Patrol, under the direction of Patrol Agent-in-Charge Steven Oldma; and the New York State Department of Environmental Conservation, under the direction of Captain Frank Lauricella.
Sentencing is scheduled for May 2, 2017, before Judge Vilardo.
Former Racine Area Person Indicted for Filing False Tax ReturnsRead the Press Release
United States Attorney Gregory J. Haanstad announced that on January 10, 2017, a federal grand jury in Milwaukee returned an indictment against Tomeki L. Tyson (age 45), now of North Las Vegas, Nevada, and formerly of Racine, Wisconsin. Tyson is charged with twenty-one counts of making a false claim against the Internal Revenue Service (IRS) by filing false federal income tax returns which claimed refunds, in violation of Title 18, United States Code, Section 287.
The indictment alleges that during the period from approximately January 2009 until February 2015, the defendant defrauded and stole money from the IRS through filing fraudulent tax returns containing false employment, income, and tax withholding information, which claimed tax refunds in the names of various actual persons. The indictment further charges that the defendant filed more than 250 such false refund claims with the IRS over this period.
Each of the twenty-one false claim charges contained in the indictment carries a maximum possible penalty of up to five years in prison and a fine of up to $250,000, or both.
“IRS Criminal investigation is committed to rigorously pursuing thieves who steal from American taxpayers,” said IRS Criminal Investigation Special Agent in Charge Shea Jones of the St. Paul Field Office. “Today’s indictment should serve as a warning to thieves that we, along with our law enforcement partners and the United States Attorney's Office, will pursue those criminals and bring them to justice.”
This matter was investigated by the Internal Revenue Service Criminal Investigations Division, and has been assigned to Assistant United States Attorney Stephen A. Ingraham for prosecution.
The public is cautioned that an indictment is merely the formal method of presenting charges in federal court and does not constitute evidence of the defendant’s guilt. The defendant is presumed innocent until such time, if ever, as the government establishes her guilt beyond a reasonable doubt.
# # #
Former Maryland Man Sentenced to 60 Years in Federal Prison for Production of Child PornographyRead the Press Release
Baltimore, Maryland – U.S. District Judge George L. Russell III sentenced Christopher Michael Salisbury, age 38, of Long Beach, California, formerly of Maryland, today to the maximum sentence of 60 years in prison, followed by lifetime supervised release, for two counts of production of child pornography. Judge Russell ordered that Salisbury pay a fine of $250,000. Judge Russell also ordered that upon his release from prison, Salisbury must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Gordon B. Johnson of the Federal Bureau of Investigation, Baltimore Field Office; and Special Agent in Charge Sean Ragan of the Criminal Division of the Federal Bureau of Investigation’s Los Angeles Field Office.
According to Salisbury’s plea agreement, between 2006 and 2013, while residing in Maryland, Salisbury sexually abused two minors, beginning when each victim was approximately five years old, and produced images and videos of himself and the minors engaged in sexually explicit conduct. Salisbury used video and photo editing software to assemble many of the videos documenting his sexual abuse of the victims into compilation videos that included music, text, and other editing.
Salisbury regularly accessed the internet through a network specifically designed to facilitate anonymous communication, commonly referred to as the “dark web.” Salisbury used the network to find and join a hidden website whose primary purpose was to advertise and distribute child pornography. Salisbury used the “dark web” and his membership in the hidden website to view, download, receive, and collect thousands of images and videos of child pornography.
Salisbury has been detained since his arrest on November 19, 2015.
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.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended, the FBI Baltimore and Los Angeles Field Offices for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Paul E. Budlow, who prosecuted the federal case.
Evansville man sentenced for possession of child pornographyRead the Press Release
Created internet blog and shared child pornography files
PRESS RELEASE
Evansville – United States Attorney Josh J. Minkler announced today that Joshua J. Walker, 28 of Evansville, Indiana, was sentenced to 120 months in prison by U.S. District Judge Richard L. Young following his guilty plea to possession and distribution of child pornography. This case was the result of an investigation by the Federal Bureau of Investigation Violent Crimes Task Force and the Evansville Police Department.
October 19, 2016, at the time of his guilty plea, Walker admitted to the Court that he used file sharing software on numerous occasions to search for images of underage girls. Walker stated he used file sharing software to conduct searches and to download images depicting children under the age of eighteen (18) years old, engaged in sexual acts and/or poses. Walker also admitted that he created his own internet blog site that was used to share depictions of minors engaged in sex acts with blog members.
According to Assistant U.S. Attorney Todd S. Shellenbarger, who prosecuted the case for the government, Judge Young imposed 5 years of supervised release following Walker’s release from prison. Walker must register as a sex offender, must not have unsupervised contact with minors, and must participate in a sex offender treatment program while on supervision. The devices Walker used to commit the offenses must be forfeited to the government as a part of the sentence.
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."
El Paso Man Sentenced to 12 Years in Federal Prison for Trafficking CocaineRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that RAUL CHAVEZ, 57, of El Paso, Texas, was sentenced today by U.S. District Judge Jeffrey Alker Meyer in New Haven to 144 months of imprisonment, followed by five years of supervised release, for trafficking cocaine. CHAVEZ also was ordered to pay a $250,000 fine.
According to court documents and statements made in court, CHAVEZ headed a cocaine trafficking operation that smuggled cocaine from Mexico into El Paso, Texas, and then transported the drug to Connecticut and elsewhere. The investigation revealed that the Chavez organization had been supplying multiple kilograms of cocaine to Hartford-area distributors since approximately 2004. The shipments, which would typically be in the range of 30 to 40 kilograms, were sent regularly from El Paso multiple times per year.
In 2014, the Chavez organization attempted to find an additional source of supply for its Hartford area cocaine customers. In July 2014, a DEA confidential source met Andrew Duron, also known as “Chavo,” in North Carolina. During the meeting, Duron told the confidential source that he wanted to purchase up to 50 kilograms of cocaine for $28,000 per kilogram. On August 14, 2014, Duron, the confidential source and an undercover DEA agent met in New Jersey where Duron agreed to purchase 25 kilograms of cocaine. In subsequent conversations with the confidential source, Duron stated that he wanted an extra $1000 per kilogram as a side deal. They agreed on a total price of $725,000 for 25 kilograms of cocaine.
The investigation revealed that this cocaine shipment was destined for Tyshawn Welborn, also known as “Black,” of Bloomfield, and Todd Vernon of Hartford, the latter of whom prepaid for approximately 13 kilograms of cocaine.
On August 22, 2014, CHAVEZ and others met with Welborn at a restaurant in East Windsor where they discussed the pick-up of money from Welborn the following day and its delivery to a location to be determined.
On August 23, 2014, Duron met the undercover DEA agent at a location in Wethersfield. Duron told the undercover agent that his associates were in Connecticut and that Duron and the undercover agent would need to travel to a store parking lot near Bradley International Airport to verify that the money was in place. Duron and the undercover agent then drove in separate vehicles to a store parking lot on Kennedy Road in Windsor. Duron met with CHAVEZ and another associate in the store. A short time later, a third associate arrived in a Jeep Wrangler, met the undercover agent in the parking lot, showed him a duffel bag and said it contained “half” of the money. Shortly thereafter, investigators arrived at the scene and arrested Duron, CHAVEZ and his associates.
Investigators also recovered from the Jeep a duffel bag containing approximately $284,000 in cash, and a loaded .38 caliber revolver. The cash had been picked up from Welborn earlier that day.
After word reached CHAVEZ’s son, Christopher Chavez, that his father and others had been arrested, Christopher Chavez coordinated the diversion of a shipment of 34 kilograms of cocaine, which was en route to Connecticut, to a high-level drug distributor in Cleveland, Ohio.
CHAVEZ has been detained since his arrest. On March 11, 2016, he pleaded guilty to one count of conspiracy to possess with intent to distribute five kilograms or more of cocaine.
Duron, Welborn, Vernon and Christopher Chavez also pleaded guilty. On September 22, 2015, Duron, of El Paso, was sentenced to 84 months of imprisonment; on October 7, 2016, Christopher Chavez, of El Paso, was sentenced to 60 months of imprisonment, and on December 21, 2016, Welborn was sentenced to 84 months of imprisonment. Vernon awaits sentencing.
This investigation has been conducted by the Drug Enforcement Administration’s Hartford Task Force, including personnel from the DEA Hartford Resident Office and the Bristol, Hartford, Manchester, New Britain, Newington, and Wethersfield Police Departments.
The case is being prosecuted by Assistant U.S. Attorneys Brian P. Leaming and Amy C. Brown.
During National Slavery and Human Trafficking Prevention Month, U.S. Attorney's Office Highlights District's Efforts to Combat Human Trafficking and Raise Awareness with Community Outreach, Training and Federal ProsecutionsRead the Press Release
CHARLOTTE, N.C. – In recognition of January as National Slavery and Human Trafficking Prevention Month, United States Attorney Jill Westmoreland Rose highlighted the efforts of the U.S. Attorney’s Office to combat human trafficking and to raise awareness through community outreach, training and federal prosecutions.
“Human trafficking is one of the most inhumane and depraved crimes that can be inflicted upon a person. Whether subjected to forced labor or forced to engage in commercial sex, trafficked victims are reduced to a status less than human, their worth measured by how profitable they are to their traffickers. In the Western District, our federal prosecutions have resulted in lengthy prison sentences for perpetrators brought to justice. But we must do more. Traffickers pray upon the most vulnerable members of our society, looking to benefit from their exploitation. There isn’t a state, city, town or community shielded from human trafficking and its devastating impact. As part of our anti-trafficking strategy, we have focused on forging strong partnerships throughout the district, and we are working with community organizations and our law enforcement partners to raise awareness and to educate the public about the epidemic of human trafficking,” said U.S. Attorney Rose.
In 2016, the U.S. Attorney’s Office partnered with the Charlotte Metropolitan Human Trafficking Task Force and federal, state, and local agencies and law enforcement to provide training on human trafficking and victim identification to professionals whose work may bring them in contact with victims of trafficking. This included emergency room physicians and nurses, hospitality industry employees, public defenders, youth and family services case workers with the Department of Social Services, and members of multiple faith-based organizations and community groups. Though tailored to address each group’s specific needs, the goal of the training was to enhance participants’ understanding of human trafficking, to educate them on recognizing the indicators, or “tell-tale signs,” of trafficking victims, to familiarize them with accessing services available to rescued victims, and to highlight best practices for reporting trafficking activity and supporting law enforcement in combating human trafficking.
In 2016, the U.S. Attorney’s Office’s anti-trafficking efforts also resulted in significant prosecutions. In February 2016, Martin Allen Meggett was sentenced to 10 years in prison after pleading guilty for the sex trafficking of a minor. In April 2016, a federal jury convicted Kenwaniee Vontorian Tate for the sex trafficking of a minor. His sentencing hearing has been scheduled for January 25, 2017. And, in May 2016, Shahid Hassan Muslim was sentenced to life in prison for operating an extensive sex trafficking enterprise that recruited women and underage girls into prostitution.
“While our successes are many and notable our work against human trafficking continues,” said U.S. Attorney Rose.
* * *
If you believe you are the victim of a trafficking situation or may have information about a potential trafficking situation, call the National Human Trafficking Resource Center (NHTRC) at 1-888-373-7888. NHTRC is a national, toll-free hotline, with specialists available to answer calls from anywhere in the country, 24 hours a day, seven days a week, every day of the year related to potential trafficking victims, suspicious behaviors, and/or locations where trafficking is suspected to occur. You can also submit a tip to the NHTRC online.
You can also contact ICE-Homeland Security Investigations at 1-866-DHS-2-ICE (1-866-347-2423) or the Charlotte Office of the FBI at 704-672-6100.
Drug Trafficker Sentenced to 196 Months in PrisonRead the Press Release
United States Attorney Andrew M. Luger announced the sentencing of EDUARDO PENALOZA-ROMERO, 27, to 196 months in prison after pleading guilty last year to conspiracy to distribute methamphetamine and marijuana. PENALOZA-ROMERO was sentenced before U.S. District Judge Susan Richard Nelson in U.S. District Court in Saint Paul, Minn.
“HSI’s collaboration with our federal, state and local law enforcement partners continues to yield significant results in Minnesota,” said Alex Khu, special agent in charge of HSI St. Paul. “Individuals like Mr. Penaloza, who conspire to flood our communities with dangerous and illicit drugs, can expect to face serious consequences. HSI will continue to seek them out and dismantle the entire criminal organization.”
According to PENALOZA-ROMERO’s guilty plea and documents filed in court, between at least November 2013 and August 2014, he conspired with others to distribute methamphetamine and marijuana. At various times during the indicted period, PENALOZA-ROMERO sold controlled substances to law enforcement, including one pound of methamphetamine on November 15, 2013, and one pound of marijuana on January 15, 2014.
According to the defendant’s guilty plea and documents filed in court, in August 2014, PENALOZA-ROMERO arranged for methamphetamine to be trafficked from California to Minnesota. Approximately 8 pounds of methamphetamine was recovered from a vehicle transporting that methamphetamine into Minnesota.
According to the defendant’s guilty plea and documents filed in court, when law enforcement executed a search warrant at PENALOZA-ROMERO’s home on September 24, 2014, law enforcement recovered a semiautomatic pistol and more than 2.5 pounds of methamphetamine in both crystal and liquid form.
The case was prosecuted by Assistant United States Allen Slaughter and was the result of an investigation conducted by Homeland Security Investigations, in collaboration with the Anoka County Drug Task Force, the Drug Enforcement Administration, the Fridley Police Department, the Minneapolis Police Department, the Minnesota State Patrol, the Ramsey County Violent Crime Enforcement Team, the Saint Paul Police Department, and the Spring Lake Police Department.
Defendant Information:
EDUARDO PENALOZA-ROMERO, 27
Spring Lake Park, Minn.Convicted:
• Conspiracy to distribute methamphetamine and marijuana, 1 countSentenced:
• 196 months in prisonDistrict Man Sentenced to 10 1/2-Year Prison Term for Series of Hold-Ups of Convenience StoresRead the Press Release
WASHINGTON – Melvin Smith, 45, of Washington, D.C., was sentenced today to a 10 ½-year prison term for a series of robberies of convenience stores last summer in Northeast and Northwest Washington, announced U.S. Attorney Channing D. Phillips and Peter Newsham, Interim Chief of the Metropolitan Police Department (MPD).
Smith pled guilty in November 2016 to three counts of robbery and was sentenced today in the Superior Court of the District of Columbia by the Honorable Danya A. Dayson. Following completion of his prison term, he will be placed on three years of supervised release.
In entering his guilty plea, Smith admitted to robbing six convenience stores in just over four weeks. According to the government’s evidence, the robberies included these crimes:
-Aug. 19, 2016, approximately 1:40 a.m.: Smith entered a 7-Eleven store in the 1200 block of Brentwood Road NE, approached a store clerk, and demanded access to the cash register. He then took approximately $50 before fleeing.
-Sept. 6, 2016, approximately 10:55 p.m.: Smith entered the 7-Eleven store in the 1300 block of Second Street NE. He approached a cashier and reached into two cash registers, taking approximately $430 before fleeing.
- Sept. 10, 2016, approximately 2:10 a.m.: Smith entered the 7-Eleven store in the 4800 block of Nannie Helen Burroughs Avenue NE and displayed an object on his right hip, which store personnel believed to be a handgun. He proceeded to the cash registers, demanded that they be opened, and took an unspecified amount of cash before fleeing.
-Sept. 12, 2016, approximately 8:45 p.m.: Smith entered the 6 & Q Market, in the 500 block of Q Street NW. Wearing a mask, he ordered a store clerk to the cash register. When the clerk responded that he did not have a key to the register, Smith grabbed the entire register, which contained an unknown amount of cash, and fled.
-Sept. 13, 2016, approximately 1:30 a.m.: Smith returned to the 7-Eleven on Second Street NE. According to a store clerk, he was carrying what appeared to be a silver gun in his waistband and demanded cash from the cash register. Smith then removed approximately $100 from the store’s two cash registers and fled.
-Sept. 18, 2016, approximately 9:45 p.m.: Smith entered a 7-Eleven store in the 900 block of Bladensburg Road NE. Wearing a mask, he displayed what the clerk believed to be a dark gun in his waistband and demanded that the clerk open the register. Smith then proceeded to take money from both of the registers, before fleeing.
Smith was arrested on Sept. 19, 2016. When he was arrested, Smith was found to be in possession of a unique mask and bandana that surveillance video confirmed were used in the robberies. He has been in custody since his arrest. The guilty plea specified the offenses that were committed on Aug. 19, Sept. 6, and Sept. 12, 2016.
In announcing the sentence, U.S. Attorney Phillips and Acting Chief Newsham commended the work of those who investigated the case from the Metropolitan Police Department. They also expressed appreciation for the work of Assistant U.S. Attorney Richard Barker, who investigated and prosecuted the case.
Dillwyn Man Sentenced to 30 Months in Federal Prison on Child Pornography ChargeRead the Press Release
Lynchburg, VIRGINIA – A local man, who pled guilty in September 2016 to illegally possessing images of child pornography, was sentenced yesterday in the United States District Court for the Western District of Virginia in Lynchburg, Acting United States Attorney Rick A. Mountcastle announced.
Phillip Dale Mahlkuch, 60, of Dillwyn, Va., previously pled guilty to one count of knowingly possessing material that contained one or more images of child pornography. Yesterday in the United States District Court for the Western District of Virginia in Lynchburg, Mahlkuch was sentenced to 30 months in federal prison and five years of supervised release thereafter. In addition, he was ordered to pay a special assessment of $100 and a fine of $7,500.
The investigation of the case was conducted by U.S. Immigration and Customs Enforcement Homeland Security Investigations, the United States Postal Inspection Service and the Buckingham County Sheriff’s Department. Assistant United States Attorney Charlene R. Day prosecuted the case for the United States.
Department of Justice to Announce Consent Decree with City of BaltimoreRead the Press Release
****** MEDIA ADVISORY ******
Attorney General Lynch Will Also Deliver Capstone Speech on Community Policing
Attorney General Loretta E. Lynch will travel to Baltimore THURSDAY, JAN. 12, to announce a consent decree with the City of Baltimore.
Later that day, the Attorney General will deliver a capstone speech on community policing that will outline the Justice Department’s efforts to highlight collaborative programs and policing practices in jurisdictions around the country that are dedicated to advancing public safety, strengthening police-community relations, and fostering mutual trust and respect.
PRESS CONFERENCE WITH THE CITY OF BALTIMORE
WHO: Attorney General Loretta E. Lynch
Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice
Department’s Civil Rights Division
Baltimore Mayor Catherine Pugh
Commissioner Kevin Davis of the Baltimore City Police Department
WHAT: Press conference to announce a consent decree with the city of Baltimore.
WHEN: THURSDAY, JANUARY 12, 2017
10:30 a.m. EST
WHERE: Baltimore City Hall
Ceremonial Room
250 City Hall, 100 N. Holliday St.
Baltimore, MD 21202
OPEN PRESS (Camera Preset by for K9 Sweep: 9:45 a.m. EST //
Final Access: 10:10 a.m. EST)
NOTE: All media must present government-issued photo I.D. (such as a driver’s license as well as valid media credentials). Press inquiries regarding logistics should be directed to Anthony McCarthy at [email protected] or (443) 902-1763.
COMMUNITY POLICING CAPSTONE SPEECH AT THE UNIVERSITY OF BALTIMORE SCHOOL OF LAW
WHAT: Attorney General Loretta E. Lynch will deliver her capstone speech
on community policing.
WHO: Attorney General Loretta E. Lynch
Principal Deputy Assistant Attorney General Vanita Gupta,
head of the Civil Rights Division
Director Ronald Davis of the Office of Community Oriented Policing Services
WHEN: THURSDAY, JANUARY 12, 2016
4:00 p.m. EST
WHERE: University of Baltimore School of Law
John and Frances Angelos Law Center
Moot Courtroom
1401 N. Charles St.
Baltimore, MD 21201
OPEN PRESS (Camera Preset by for K9 Sweep: 1:15 p.m. EST //
Final Access: 3:45 p.m. EST)
NOTE: Media should RSVP to [email protected]. Questions regarding logistics should go to the Office of Public Affairs. All media must present government-issued photo I.D. (such as a driver’s license) as well as valid media credentials.Denver Woman Sentenced to Federal Prison for Conspiracy to Defraud the IRSRead the Press Release
DENVER – Sherry Charleston, age 41, of Denver, Colorado was recently sentenced by Chief U.S. District Court Judge Marcia S. Krieger to serve 18 months in prison followed by 3 years of supervised release for conspiracy to defraud the Internal Revenue Service, announced the United States Attorney’s Office, IRS Criminal Investigation and Social Security Administration Office of Inspection General. Charleston was also ordered to pay $16,541 in restitution to the IRS.
Jaquon Mucsarney and co-conspirator, Sherry Charleston were indicted by a Federal Grand Jury in Denver on January 7, 2016 for mail fraud, conspiring to defraud the government, false claims, aggravated identity theft and obstruction of justice. Jaquon's mother, Schosche Mucsarney, who was indicted on similar charges, pled guilty and was sentendced on November 22, 2016. Charges against Jaquon Mucsarney are still pending.
According to the indictment and plea agreement, from January 14, 2015 and continuing through October 27, 2015, Charleston assisted Jaquon in a scheme to defraud the Internal Revenue Service by attempting to cause tax refund checks to be issued from the United States Treasury based on false information provided in tax returns filed with the IRS. Charleston aided Jaquon in a variety of ways during the scheme including helping in the creation of fictitious companies and the issuance of Employment Identification Numbers (“EINs”), assisting in the filing of false corporate income tax returns, and assisting in the receipt, collection and disbursement of impermissibly obtained IRS refunds.
As part of the scheme, Charleston opened a business bank account in the name of one of the shell companies she created and deposited IRS refund checks into the account. She typically directed some of the refund money to Jaquon’s inmate account at the prison where he was incarcerated on state charges. Jaquon, with Charleston’s assistance, caused approximately 13 tax returns to be filed with the IRS containing false information in order to claim refunds totaling $119,934.
To further obstruct and impede the IRS, on February 12, 2015, Charleston provided false and misleading information to an IRS Special Agent investigating Jaquon’s activities. Additionally on June 22, 2015, Charleston, on Jaquon’s advice and counsel, intentionally failed to appear for testimony before a Federal Grand Jury.
This case was investigated by the Internal Revenue Service – Criminal Investigation and Social Security Administration – Office of Inspection General. This case was prosecuted by Assistant United States Attorney Tim Neff.
Crack Cocaine Sends Local Man to PrisonRead the Press Release
CORPUS CHRISTI, Texas – A 31-year-old Corpus Christi man has been ordered to federal prison following his conviction of possession with intent to distribute cocaine base, commonly known as crack cocaine, announced U.S. Attorney Kenneth Magidson. Gilbert Bustamante pleaded guilty Aug. 4, 2016.
Today, U.S. District Judge Nelva Gonzalez Ramos handed Bustamante a 77-month sentence to be immediately followed by four years of supervised release.
On March 2, 2016, law enforcement officers were attempting to locate and arrest a wanted individual at Bustamante’s residence in Corpus Christi. When Bustamante opened the door, officers detected the odor of marijuana inside the residence. Based on the odor, law enforcement officers obtained and executed a search warrant. During that search, officers discovered 47 grams of cocaine base, a digital scale, approximately $5,000 in U.S. currency and a .38 caliber handgun.
In federal custody since his arrest, Bustamante will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Corpus Christi Police Department conducted the investigation. Assistant U.S. Attorney Lance Watt prosecuted the case.
Columbia Man Indicted for Child PornRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Columbia, Mo., man was indicted by a federal grand jury today on charges related to child pornography.
Brandon Lee Deavers, 22, of Columbia, was charged in a two-count indictment returned by a federal grand jury in Jefferson City, Mo. State charges filed against Deavers in a related case will be dismissed in lieu of the federal indictment.
Today’s indictment alleges that Deavers received and distributed child pornography over the Internet from July 1 to Oct. 19, 2016. Deavers is also charged with accessing with the intent to view child pornography during that period of time.
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 Ashley S. Turner. It was investigated by the FBI and the Boone County, Mo., Sheriff’s 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."
Collin County Woman Sentenced for Federal Income Tax ViolationsRead the Press Release
SHERMAN, Texas – A 44-year-old McKinney, Texas woman has been sentenced to federal prison for income tax violations in the Eastern District of Texas, announced Acting U.S. Attorney Brit Featherston today.
Sandra Ayanna Morgan pleaded guilty on July 11, 2016 to filing a false income tax return and was sentenced to 18 months in federal prison today by U.S. District Judge Marcia A. Crone. Morgan was also ordered to pay restitution in the amount of $152,471.
According to information presented in court, Morgan was in the business of preparing federal income tax returns and admitted to preparing and presenting to the Internal Revenue Service, a United States Individual Income Tax Return Form 1040, of another individual for calendar year 2010. The return falsely represented that the taxpayer was entitle to claim deductions for losses from a business on Schedule C and losses for rental property on Schedule E. In addition, Morgan knowingly and willfully prepared false and fraudulent tax returns for a number of individuals for tax years 2009, 2010, 2011, and 2012. Those tax returns claimed fraudulent tax deductions for the taxpayers for things such as Education Credits, American Opportunity Credits, Charitable Contributions, Unreimbursed Employee Expenses, Medical and Dental Expenses, Loses for Rental Property, and Losses from a Business. The taxpayers did not represent to Morgan that they were entitled to the tax credits or deductions, and Morgan knew the representations in the tax returns were false and material.
The total tax loss, to the Internal Revenue Service, that resulted from these false tax returns was $152,741.
This case was investigated by the Internal Revenue Service Criminal Investigations and was prosecuted by Assistant U.S. Attorney Andy Williams.
Champaign Man Sentenced for Bank Robberies in East Central Illinois and IndianaRead the Press Release
Urbana, Ill. – A Champaign, Ill., man, Darryl S. Coleman, 30, of the 1200 block of Joanne Lane, has been ordered to serve a total of 137 months (11 years, 5 months) in federal prison for bank robberies in east central Illinois and northwestern Indiana that occurred in October and November 2015.
Coleman appeared yesterday before U.S. District Judge Colin S. Bruce, in Urbana. Judge Bruce ordered that Coleman serve 115 months in prison for the bank robberies at First Financial Bank, Champaign, on Oct. 28, 2015; First Bank in Rantoul on Nov. 10; First Midwest Bank, Danville, on Nov. 17; and, attempted robbery of the Farmers-Merchants National Bank in Paxton, Ill., on Dec. 1, 2015. Judge Bruce ordered that a portion of Coleman’s sentence, 22 months, be served consecutive to the sentence ordered in Indiana.
On June 16, 2016, Coleman was sentenced in the Northern District of Indiana to 63 months in federal prison for robberies of the Horizon Bank in Portage, Ind., on Nov. 2, 2015, and the First State Bank of Porter in Chesterton, Ind. on Nov. 24, 2015.
Coleman was also ordered to pay restitution in the total amount of $20,986; restitution of $9,930 for the Illinois bank robberies, and $11,056 for the bank robberies in Indiana.
Supervisory Assistant U.S. Attorney Eugene L. Miller prosecuted the case in the Central District of Illinois, Urbana Division. The charges were investigated by the FBI and the Champaign, Danville, Rantoul and Paxton Police Departments in east central Illinois.
Coleman has remained in the custody of the U.S. Marshals Service since his arrest on Jan. 25, 2016. Coleman pled guilty to the bank robberies in Illinois in September 2016; he entered his plea of guilty to the Indiana bank robberies in March 2016.