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1 February 2017
Tonawanda Man Sentenced for Production of Child PornographyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051Buffalo, N.Y.—Acting U.S. Attorney James P. Kennedy, Jr. announced today Jason M. Smith, 36, of Tonawanda, NY, who was convicted of production of child pornography, was sentenced to 40 years in prison by Senior U.S. District Judge William M. Skretny.
Assistant U.S. Attorney Scott S. Allen, Jr., who handled the case, stated that on April 11, 2014, the Lancaster Police Department executed a search warrant at Smith’s residence on Byron Avenue in Tonawanda. During the search, officers seized external hard drives. Subsequent examination by the Western New York Regional Forensic Laboratory determined that the defendant was producing child pornography at his residence.
The investigation determined that between 2010 and 2012, Smith coerced Victim 1, who was less than 12 years old, to engage in sexually explicit conduct and produced a visual depiction of the conduct. The defendant was a friend of Victim 1’s father. Between July 2011 and September 2013, Smith coerced another individual, Victim 2, a 15-year old girl he met on MeetMe.com, to engage in sexual intercourse and took pictures of the conduct.
In addition, the investigation determined that the defendant sexually assault at least five more underage female victims. A forensic review of Smith’s electronics devices recovered over 1000 images of child pornography.
The sentencing is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Adam S. Cohen; the Lancaster Police Department, under the direction of Chief Gerald J. Gill, Jr.; and the Cheektowaga Police Department, under the direction of Chief David Zack.
Tommy Allen “Bert” Sentenced to Serve 240 Months in Prison for Distributing Crack CocaineRead the Press Release
GREENEVILLE, Tenn. – On Jan. 31, 2017, Tommy Allen, a.k.a. Bert, 30, of Kingsport, Tenn., formerly of Forrest City, Ark., was sentenced by the Honorable R. Leon Jordan, U.S. District Court Judge, to serve 240 months in federal prison for distributing crack cocaine. Upon his release from prison, he will be on supervised release for five years. There is no parole in the federal system.
Tommy Allen pleaded guilty in June 2016 to a conspiracy to distribute 280 grams or more of crack cocaine. He was a member of a drug trafficking organization, involving 10 co-defendants, which obtained powder cocaine in Forrest City, Ark., and then transported it to Kingsport, Tenn., where it was “cooked” into crack cocaine and distributed in the Tri-Cities. Tommy Allen, the brother of the conspiracy’s leader, Billy Allen, a.k.a. “Grill,” distributed crack cocaine and fielded phone calls from customers ordering crack cocaine from the organization. Tommy Allen admitted to being conservatively responsible for distributing between 840 grams and 2.8 kilograms (approximately two to six pounds) of crack cocaine. He faced a minimum mandatory sentence of 10 years in prison as a result of trafficking in at least 280 or more grams of crack cocaine.
Agencies involved in this investigation included the Second Judicial District Drug Task Force, Kingsport Police Department, Sullivan County Sheriff’s Office, Bristol Police Department, Tennessee Bureau of Investigation, Bureau of Alcohol Tobacco Firearms and Explosives, Internal Revenue Service, and Drug Enforcement Administration. J. Gregory Bowman, Assistant U.S. Attorney represented the United States.
This case was a result of the Department of Justice’s Organized Crime and Drug Enforcement Task Force (OCDETF) program, the centerpiece of the Department of Justice’s drug supply reduction strategy. OCDETF was established in 1982 to conduct comprehensive, multi-level attacks on major drug trafficking and money laundering organizations. Today, OCDETF combines the resources and expertise of its member federal agencies in cooperation with state and local law enforcement. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking and money laundering organizations and those primarily responsible for the nation’s drug supply.
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Three Pittsburgh Residents Charged in Cocaine Distribution RingRead the Press Release
PITTSBURGH - Three residents of Pittsburgh have been indicted by a federal grand jury in Pittsburgh on charges of conspiracy to possess with intent to distribute and distribute 5 kilograms or more of cocaine, possession with intent to distribute 5 kilograms or more of cocaine, and conspiracy to commit money laundering, Acting United States Attorney Soo C. Song announced today.
The three-count indictment, returned yesterday, named Richard Stuart Wright, 74, and his wife, Michele Lynn Connell, 47, and Walter John Amman, III, 66, as defendants.
According to information presented to the court, several controlled purchases of cocaine were made from persons involved in the conspiracy which permitted federal agents to acquire search warrants for the residences of Wright, Connell and Amman, as well as a storage garage near Wright’s house, bank accounts and safety deposit boxes. A total of more than 5 kilograms of cocaine, some converted to crack, was located, along with over $600,000 in cash, numerous firearms, multiple vehicles and Harley Davidson motorcycles and drug packaging materials. Prepackaged amounts of cocaine were located in a fireman’s jacket with Amman’s name on it in his residence, and additional packaged amounts were located in his truck. These prepackaged quantities were color coded by their weight and also by their contents (i.e. crack cocaine or powder cocaine). This coding system was consistent with the prepackaged drugs in Wright’s residence and nearby garage. Federal authorities have also filed court documents to forfeit Wright’s Daytona Beach, Florida, residence, alleging that it was purchased with laundered money from Wright’s drug trafficking.
The law provides for a maximum total sentence of not less than 10 years and up to life in prison, a fine of up to $40,000,000, or both, for the drug charges faced by Wright and Amman, while Connell and Wright also face a maximum total sentence of 20 years in prison, a fine of up to $500,000, or both, for the money laundering charge. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendants.
Assistant United States Attorney Ross E. Lenhardt is prosecuting this case on behalf of the government.
The Internal Revenue Service-Criminal Investigation, Drug Enforcement Administration, Homeland Security Investigations, U.S. Postal Inspection Service and the Pittsburgh Bureau of Police conducted the investigation leading to the Indictment in this case.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Three Franklin County Residents Sentenced on Identity Theft ChargesRead the Press Release
St. Louis, MO – Three Franklin County, Missouri, residents have been sentenced for their participation in a conspiracy to commit identity theft and access device fraud in the Eastern District of Missouri.
According to court documents, John Dean Townsend stole the personal identification information of his customers while he was employed at an automotive dealership located in St. Louis County and sold the information to Jessica L. Franklin in exchange for quantities of methamphetamine and U.S. currency. Franklin used the stolen identification information to manufacture fraudulent Missouri Department of Revenue temporary driver’s licenses which Franklin and Jesse Ray Chitwood used to open lines of credit and purchase merchandise at various retailers throughout the Eastern District of Missouri.
Jessica L. Franklin, Beaufort, MO, pled guilty in October 2016 to one count of conspiracy to commit identity theft and one count of aggravated identity theft. She was sentenced in January 2017 to 45 months in the Bureau of Prisons.
Jesse Ray Chitwood, St. Clair, MO, pled guilty in September 2016 to one count of conspiracy to commit identity theft. He was sentenced in January 2017 to 24 months in the Bureau of Prisons.
John Dean Townsend, Pacific, MO, was sentenced today to 13 months on one felony count of conspiracy to commit identity theft and access device fraud.
All defendants appeared before United States District Judge John A. Ross.
This case was investigated by the Franklin County Sheriff’s Office; the Washington, Missouri, Police Department; the Ballwin Police Department and the Kirkwood Police Department. Assistant United States Attorney Jennifer Roy handled the case for the U.S. Attorney’s Office.
Tahlequah Man Sentenced to 120 Months for Drug Conspiracy, Firearm PossessionRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that JIMMY W. SEQUICHIE JR, age 25, of Tahlequah, Oklahoma, was sentenced to 120 months imprisonment, and 5 years of supervised release for DRUG CONSPIRACY, in violation of Title 21, United States Code, Sections 846, 841(a)(1) and 841(b)(1)(B); and for POSSESSION OF FIREARM IN FURTHERANCE OF A DRUG TRAFFICKING CRIME, in violation of Title 18, United States Code, Sections 924(c)(1)(A) and 2.
The Superseding Indictment alleged that from in or about the end of 2013 and continuing until on or about January 27, 2016, in the Eastern District of Oklahoma, the defendant, did willfully and knowingly combine, conspire, confederate and agree together, and with other persons known and unknown, to Possess with Intent to Distribute and to distribute 50 grams or more of a mixture or substance containing a detectable amount of Methamphetamine, a Schedule II Controlled Substance.
The Superseding Indictment further alleged that on or about November 25, 2015, within the Eastern District of Oklahoma, the defendant did knowingly possess a firearm in furtherance of a drug trafficking crime.
The charges arose from a joint investigation by the Oklahoma Bureau of Narcotics, the Tahlequah Police Department, the Muskogee Police Department, the Oklahoma Department of Corrections, the Bureau of Indian Affairs and the Drug Enforcement Administration. The investigation was coordinated by the Organized Crime Drug Enforcement Task Force (OCDETF) of the Eastern District of Oklahoma. OCDETF is an initiative led, and coordinated by, the Office of the United States Attorney.
The Honorable Ronald A. White, District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearing. The defendant will remain in custody pending transportation to the designated federal facility at which the nonparoleable sentence will be served.
Assistant United States Attorney Shannon Henson represented the United States.
Staunton Doctor Sentencing for Illegal Prescribing of NarcoticsRead the Press Release
Lynchburg, VIRGINIA – A Staunton physician practicing in Lexington at Carilion Stonewall Jackson Hospital Emergency Department was sentenced today on a federal drug distribution charge, Acting United States Attorney Rick A. Mountcastle announced.
Stanley Elmer Heatwole, 73, of Staunton, Virginia, previously waived his right to be indicted and pled guilty to an Information charging him with one count of distribution of controlled substances. Today in District Court, Heatwole was sentenced to three years of probation, six months of which must be spent on home confinement. In addition, the defendant was ordered to pay a $3,000 fine and a special assessment of $100.
According to evidence presented at previous hearings by Assistant United States Attorney Jennie L. M. Waering, from 2009 to 2014, Stanley Elmer Heatwole wrote controlled substance prescriptions, specifically hydrocodone, to a female patient with whom he had an intimate relationship. These prescriptions were not for a legitimate medical purpose and were outside the usual course of professional practice. In 2014, his license to practice medicine was suspended.
The investigation of the case was conducted by the Tactical Diversion Squad of the Drug Enforcement Administration and the Virginia State Police. Assistant United States Attorney Jennie L. M. Waering is prosecuting the case for the United States.
St. Louis County Man Sentenced on Fraud ChargesRead the Press Release
St. Louis, MO – Charles Hicks, Fenton, Missouri, was sentenced to 27 months in prison involving a false invoice scheme to defraud two employers, causing a loss of $386,000. In addition to the prison sentence, Hicks was ordered to pay restitution of $386,000.
According to his plea agreement, Hicks devised a false invoice scheme to defraud two successive employers, RockTenn Company and MarChem Company, over the course of two and a half years. Hicks had authority to identify vendors and authorize purchases and used dummy companies to submit and receive payments for false invoices.
Hicks pled guilty in October to one felony count of mail fraud. He appeared today for sentencing before U.S. District Judge Stephen N. Limbaugh, Jr.
This case was investigated by the FBI and the U.S. Postal Inspection Service. Assistant United States Attorney Tom Albus handled the case for the U.S. Attorney’s Office.
Six Restaurant Employees Plead Guilty to Illegal Reentry ChargesRead 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 six defendants pleaded guilty to illegal reentry charges before Chief U.S. District Judge Frank P. Geraci including:
• Joel Hernandez-Martinez, 29, of Mexico, pleaded guilty to illegal reentry after deportation following a felony conviction. The defendant, who worked at Don Tequila, faces up to 10 years in prison when sentenced on April 20, 2017, by Judge Geraci.
• Miguel Sanchez-Ocampo, 40, of Mexico, pleaded guilty to illegal reentry after deportation after a felony conviction. The defendant, who worked at El Agave, faces up to 10 years in prison when sentenced by Judge Geraci at a later date.In addition, the following four defendants pleaded guilty to illegal reentry after deportation and were each sentenced to time served. They are now in the custody of Immigration and Customs Enforcement (ICE) awaiting execution of prior removal orders entered against them:
• Walter Lopez-Cabrera, 30, of Honduras, who defendant worked at Agave; • Araceli Lopez-Martinez, 33, of Mexico, who worked at Don Tequila; • Alejandro Valadez-Leon, 46, of Mexico, who worked at Agave; and
• Eliel Sanchez-Ocampo, 34, of Mexico, who worked at Don Tequila.The pleas and sentencings are the result of an investigation by Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Acting Special Agent-in-Charge Kevin Kelly and the New York State Department of Taxation and Finance.
Simpson County, Kentucky, Woman Guilty of Bank RobberyRead the Press Release
Stole $43,100 and threatened to kill bank employees, customers and an alleged child held hostage
BOWLING GREEN, Ky. – A Simpson County, Kentucky, woman pleaded guilty Monday, January 30, 2017, in United States District Court, before District Court Judge Greg N. Stivers, to a single count of bank robbery announced United States Attorney John E. Kuhn, Jr.
According to the plea agreement, Patricia Lamar Brewer, 48, admitted to robbing the Citizens First Bank located at 1200 South Main Street, in Franklin, Kentucky, of $43,100 at approximately 9:30 a.m. on July 30, 2012.
Further, Brewer admitted to wearing eye-glasses, a hat, and a wig and handing a teller a threatening note stating:
“Don’t call cops or set off any alarms be calm we are watching you we have this ladys child if she don’t do what we say she will die and her daughter and everyone in this bank 80,000 dollars unmarked, untraceable bills if she is not out here in 5 min she will die along with her daughter and everyone in this bank we are watching you now so hurry now if you want to live.”
Brewer was previously convicted of robbing a bank in Panama City Beach, Florida, using a similar disguise and note. Evidence gathered from that robbery led FBI to Brewer and the Kentucky bank robbery.
Brewer remains in federal custody awaiting sentencing on May 2, 2017, at 10:30 a.m. CST, before District Judge Stivers in Bowling Green.
If convicted at trial, Brewer could have been sentenced to a 20-year maximum term of imprisonment, fined $250,000 and served a three-year term of supervised release.
This case is being prosecuted by Assistant United States Attorney David Weiser and is being investigated by the Federal Bureau of Investigation (FBI).
Seven Defendants Indicted in Multi-Million Health Care Fraud and Money Laundering Scheme Involving Sober Homes and Alcohol and Drug Addiction Treatment CentersRead the Press Release
Seven defendants including owners, doctors, a manager, and a laboratory representative of sober homes and alcohol and drug addiction treatment centers were charged for their participation in a health care fraud and money laundering scheme that involved the filing of fraudulent insurance claim forms and defrauded health care benefit programs.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Dave Aronberg, State Attorney, Palm Beach County State Attorney’s Office, Jeff Atwater, Florida Chief Financial Officer, William D. Snyder, Sheriff Martin County Sheriff's Office, Robert Koons, Special Agent in Charge, Amtrak Office of Inspector General, Rafiq Ahmad, Special Agent in Charge, United States Department of Labor, Office of Inspector General (DOL-OIG), Isabel Colon, Regional Director, United States Department of Labor, Employee Benefits Security Administration (DOL-EBSA), Dennis Russo, Director of Operations, National Insurance Crime Bureau (NICB), Ric Bradshaw, Sheriff, Palm Beach County Sheriff's Office (PBSO), Bryan Kummerlen, Chief, West Palm Beach Police Department, Jeffrey S. Goldman, Chief, Delray Beach Police Department, Pam Bondi, Florida Attorney General, and Scott Rezendes, Special Agent in Charge, Office of Personnel Management, Office of Inspector General (OPM-OIG), made the announcement.
Kenneth Chatman, a/k/a “Kenny,” 46, of Boynton Beach, Joaquin Mendez, 52, of Miramar, Donald Willems, 40, of Weston, Fransesia Davis, a/k/a “Francine,”a/k/a “Francesa,” 44, of Lake Worth, Michael Bonds, 45, of Delray Beach, and Laura Chatman, 44, of Boynton Beach, are charged with one count of conspiracy to commit health care fraud, in violation of Title 18, United States Code, Section 1349, and one count of money laundering conspiracy, in violation of Title 18, United States Code, Section 1956(h). Stefan Gatt, 27, of Deerfield Beach, is charged with one count of conspiracy to commit health care fraud. Kenneth and Laura Chatman are also charged with seven counts of money laundering, in violation of Title 18, United States Code, Section 1956(a)(1)(A)(i), three counts of money laundering in excess of $10,000, in violation of Title 18, United States Code, Section 1957, and two counts of making a false statement related to a health care matter, in violation of Title 18, United States Code, Section 1035(a)(1). Joaquin Mendez, Fransesia Davis, and Michael Bonds are also charged with two counts of money laundering. Donald Willems is also charged with one count of money laundering. Kenneth Chatman and Davis are charged with one count of maintaining a drug-involved premises, in violation of Title 21, United States Code, Section 856(a)(2). Kenneth Chatman is charged with one count of sex trafficking conspiracy, in violation of Title 18, United States Code, Section 1594(c). The defendants have each been arraigned on the charges.
According to the indictment, defendants Kenneth Chatman, Davis, and Bonds established sober homes, including Stay’n Alive, Inc., Redemption Sober House, Inc., Total Recovery Sober Living LLC, and other sober homes, which were purportedly in the business of providing safe and drug-free residences for individuals suffering from drug and alcohol addiction. To obtain residents for the sober homes, members of the conspiracy provided kickbacks and bribes, in the form of free or reduced rent and other benefits, to individuals with insurance who agreed to reside at the sober homes, attend drug treatment, and submit to regular drug testing that members of the conspiracy could bill to the residents’ insurance plans. Although the sober homes were purportedly drug-free residences, some of the defendants permitted the residents to continue using drugs as long as they attended treatment and submitted to drug testing.
Defendants Kenneth Chatman, Bonds, and Davis referred the sober homes’ residents who had insurance to treatment centers owned by Kenneth Chatman but titled in the name of Laura Chatman. These treatment centers purportedly offered clinical treatment services for persons suffering from alcohol and drug addiction. In most instances, defendant Kenneth Chatman knew that the sober home residents referred to the treatment centers, Journey to Recovery LLC, in Lake Worth, Florida, and Reflections Treatment Center, LLC, in Margate, Florida, were using drugs.
Defendant Kenneth Chatman hired doctors, including defendants Mendez and Willems, to serve as medical directors of his treatment centers. The doctors ordered drug treatment and drug testing for the sober home residents, specifically expensive urine and saliva drug screens and allergy testing, regardless of whether such treatment and testing were medically necessary. The defendants provided services meant solely to maximize insurance reimbursements. In some instances, defendants Kenneth Chatman and Davis submitted urine and saliva samples from employees instead of urine and saliva from patients. In other instances, defendant Kenneth Chatman caused confirmatory testing to be performed and billed for residents who left the sober homes and were no longer receiving treatment at the treatment centers. Defendants Mendez and Willems also falsely documented patient files to make it appear as though they reviewed the test results.
Defendants Kenneth Chatman and Davis engaged in various tactics to keep patients from being able to leave Reflections and Journey, including threatening violence, and confiscating their belongings, such as car keys, telephones, medications, and food stamps, in order to maintain the ability to continue fraudulently billing their insurance companies.
Defendant Kenneth Chatman also recruited and coerced female patients and residents into prostitution, telling them that they would not have to pay rent or participate in treatment or testing so long as they would allow him to continue to bill their insurance companies for substance abuse treatment and testing that the patients did not receive.
Defendants Kenneth and Laura Chatman submitted to the Florida Department of Children and Families fraudulent applications for licensure for Journey to Recovery and Reflections Treatment Center, stating that Laura Chatman was the sole owner of those entities and hiding the fact that Kenneth Chatman owned and operated the treatment centers.
If convicted, the defendants face a maximum statutory sentence of ten years in prison for the conspiracy to commit health care fraud and money laundering in excess of $10,000 charges; a maximum statutory sentence of twenty years in prison for the money laundering conspiracy, money laundering, and maintaining a drug-involved premises charges; and a maximum statutory sentence of five years in prison for making a false statement related to a health care matter. Kenneth Chatman faces a maximum statutory sentence of life in prison for the sex trafficking conspiracy charge. The indictment also seeks the forfeiture of more than $5.4 million that insurance companies paid based upon the fraudulent claims submitted by members of the conspiracy.
An indictment is a formal charging document notifying the defendant of the charges. All persons charged in an indictment are presumed innocent until proven guilty in a court of law.
Potential victims should call (561) 822-5114 or submit complaints through the IC3 Complaint Form - https://www.ic3.gov/complaint/default.aspx and use the key word “Chatman Reflections” in the “Description of the Incident” field when submitting complaints related to this case.
Ferrer commended the investigative efforts of the Greater Palm Beach Health Care Fraud Task Force. Agencies of the task force include the FBI, IRS-CI, the Palm Beach County State Attorney's Office Sober Homes Task Force, Florida Division of Investigative and Forensic Services, Martin County Sheriff's Office, Amtrak OIG, DOL-OIG, DOL-EBSA, National Insurance Crime Bureau, Palm Beach County Sheriff's Office, West Palm Beach Police Department, Delray Beach Police Department, Florida Attorney General Office of Statewide Prosecution, and OPM-OIG. The cases are being prosecuted by Assistant United States Attorney A. Marie Villafaña.
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.
San Fernando Valley Man Who Served Nearly 8 Years for Investment Scam Sentenced to Another 6 Months for Violating Terms of ReleaseRead the Press Release
LOS ANGELES – A convicted con man who defrauded a North Carolina man out of more than $8.7 million and was sentenced to nine years in federal prison has been sentenced to another six months in prison for violating the terms of his supervised release by traveling to Africa without permission in relation to another possible fraud scheme.
Thomas Mitchell Johnson, 62, was sentenced Monday afternoon to six months in federal prison, which will be followed by two years of supervised release. Johnson lives in Sherman Oaks, and he resided in Burbank prior to being convicted and sentenced in 2008.
The sentencing follows Johnson’s admission late last year that he violated the terms of his supervised released – a three-year period of court supervision that followed his prison term – by traveling to the Ivory Coast without permission from the court or his probation officer.
On July 25, 2015 – only 10 days after being released from federal prison in the fraud case – Johnson sought a court order to allow him to travel to the Ivory Coast. Johnson claimed he had an opportunity to work as a consultant on a cashew and almond processing plant with the government of the Ivory Coast, and that the government of the West African nation had agreed to pay his travel and living expenses. This request was denied by the court.
In April and July of 2016, Johnson sought permission to travel to New York City for work, requests that were granted. On July 20, 2016, Johnson was stopped by U.S. Customs and Border Protection at Los Angeles International Airport after arriving on a flight from Paris as part of trip that originated in the Ivory Coast. A review of his passport revealed that Johnson had traveled to the Ivory Coast in both April and July of 2016. Further investigation revealed that Johnson had made a video in New York City in May 2016 in which he discusses plans for his company to engage in cashew and cocoa processing, how “we are already committed on paper” to investing “$50 million every six months for two and one-half years,” and that the project would create hundreds of thousands of jobs in the Ivory Coast.
The Probation Office filed a petition with the court concerning Johnson’s unauthorized travel, allegations that Johnson admitted in December.
“This defendant lied to his probation officer and lied to customs officials at LAX, and his violations are even more egregious because it appears that he was traveling in order to engage in another scheme to defraud,” said United States Attorney Eileen M. Decker. “Despite a lengthy prison sentence, this defendant took steps almost immediately upon release to flout the court’s authority and the law. The public should be aware of persistent recidivists who simply cannot stop committing their crimes.”
Johnson was on supervised released after serving a prison sentence resulting from a fraud scheme in which he defrauded a North Carolina man out of millions of dollars in a scheme that purportedly involved high-yield bonds. Johnson was sentenced after being found guilty at trial of six counts of interstate transportation of stolen property and five counts of money laundering. Through his company, Zurich Capital Holdings, Inc., Johnson offered an investment opportunity to the victim-investor, who transferred $10 million to an account Johnson controlled. Johnson spent the majority of the victim’s money on extravagant personal expenses for himself and his girlfriend including the purchase of two luxury homes in Burbank and high-end automobiles, including two Bentleys, two Mercedes Benz and a Land Rover.
Johnson was sentenced on Monday for the supervised release violation by United States District Judge R. Gary Klausner.
The case Johnson was investigated by the FBI, and the violation of supervised release was investigated by the United States Probation Office. Assistant United States Attorney Ruth C. Pinkel of the Public Corruption and Civil Rights Section prosecuted the case.
Rose Hill Woman Sentenced to Prison for Conspiring to File Fraudulent Income Tax ReturnsRead the Press Release
RALEIGH – The United States Attorney’s Office for the Eastern District of North Carolina announces that on today, in federal court, United States District Judge Terrence W. Boyle, sentenced MIRNA LETICIA DURAN, 39, of Rose Hill, North Carolina, to 24 months imprisonment followed by 3 years of supervised release and ordered her to pay $247,290 in restitution to the Internal Revenue Service.
On June 27, 2016, DURAN pled guilty to conspiracy to file fraudulent income tax returns using Individual Taxpayer Identification Numbers (ITINs). The ITIN program enables aliens, who earn income in the United States, to file income tax returns and pay taxes. The wage and tax statements attached to these ITIN returns were fraudulent. Refunds were inflated by claiming fictitious dependents to obtain child tax credits. The total amount of refunds sought by DURAN and her co-conspirators exceeded 1.4 million dollars. The IRS did not issue all the refunds sought because it detected the fraud.
DURAN also filed a fraudulent return in her name, falsely claiming she earned income working for a company and paid withholding taxes resulting in a $9,409 tax refund.
The Internal Revenue Service’s Criminal Investigation Division led the investigation of this case with the assistance of the United States Department of Homeland Security Investigations (HIS), the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the United States Postal Inspection Service, and the Duplin County Sheriff’s Office.
Assistant United States Attorney Susan B. Menzer represented the government.
Ringleader of Texas-Based Gas-Pump Skimming and Identity Theft Scheme Convicted on All ChargesRead the Press Release
Jury Convicts Last of Seven Defendants in Scheme that Stretched from Texas to Colorado, Indiana, Wisconsin, Ohio and Michigan
GRAND RAPIDS, MICHIGAN — Antonio DeJesus Perez-Martinez, 44, of Austin, Texas, was convicted on 30 January 2017 of conspiracy to commit wire-fraud, credit account fraud, and aggravated identity theft after a four-day jury trial. Perez-Martinez, the last of eight defendants charged in the case and the overall leader of a conspiracy that at times involved over a dozen participants, remains in the custody of the U.S. Marshals Service pending sentencing on 15 May 2017 before Chief Judge Robert J. Jonker, who presided over the trial.
The evidence at trial established that Perez-Martinez, a Cuban citizen and lawful permanent resident of the United States ("green-card" holder), recruited numerous other recently-arrived Cuban citizens – all of whom had entered the United States in 2014 under a special "parole" program that admits Cuban citizens who present themselves to immigration authorities at the border – into a fraud scheme that initially involved obtaining compromised credit-account data from illicit websites, encoding that data onto cards, and using the "cloned" cards to bulk-buy gift cards and stored-value cards. During the Summer of 2015, Perez-Martinez switched from acquiring account data online to using "skimming" devices that his accomplices secretly installed inside gas-pumps, and also extended his group’s operation into West Michigan. Skimming devices capture the account data of any card used to purchase gas without interfering with the purchase, leaving the account holder unaware that the data has been compromised until it has been re-encoded onto cloned cards and used to make unauthorized purchases. Because skimming devices acquire account data firsthand, the numbers are more recent and more reliable than those acquired secondhand from online hackers, and the illegal profits are greater.
Perez-Martinez’ conviction brings the total number of convictions from the case to seven: Raul Gonzalez Falcon (29), Yunier Carballo-Pupo (34), Manuel Perez-Cabrera (38), and Michel Velazquez-Gregori (30), none of whom had prior criminal records and all of whom agreed to plead guilty and to cooperate with the investigation, all received sentences of 21 months in prison. Pedro Sanchez-Pupo (32) received a sentence of 37 months. A seventh defendant, Juan Estrada-Galvez, was allowed to plead guilty to a state misdemeanor in Kent County when the investigation determined that his involvement in the scheme was minimal. Perez-Martinez faces maximum penalties of 30 years in federal prison for the conspiracy and ten years for the credit account fraud, as well as a mandatory two-year prison sentence for the aggravated identity theft charge that must be served after the sentences on the first two counts are complete.
"Identity-theft is a continually expanding and especially pernicious form of property crime," stated Acting U.S. Attorney Andrew Birge, "and the pump-skimmer scheme is an aggravated form of identity theft because it targets every citizen of West Michigan doing one of the most basic and necessary things we all have to do: putting gas in our tanks. Any person who comes to West Michigan on a skimmer crew had better understand that the odds of getting caught are good, and that if they are caught, they will be prosecuted in Federal court."
"As demonstrated by Monday’s guilty verdict, the defendant orchestrated a fraudulent scheme in order to steal proprietary financial information from their victims through the use of credit card skimmers at local gas stations," added David P. Gelios, Special Agent in Charge, Detroit Division of the FBI. "Criminals who engage in these types of plots exploit and manipulate the very technology that we depend on to conduct secure financial transactions in the retail marketplace. Furthermore, such high-tech criminal activity causes significant losses for both merchants and banking institutions. The FBI and its local, state and federal law enforcement partners remain committed to protecting consumers, businesses, and financial institutions from the fraud schemes of criminal enterprises like the one this defendant led."
The case was investigated primarily by the FBI’s Lansing office, with assistance from the U.S. Postal Inspection Service, the Grand Rapids Metro Fraud and Identity-Theft Team, the Grand Ledge Police Department, and the McAllen Police Department, McAllen, Texas. It is being prosecuted by Assistant U.S. Attorney Hagen W. Frank.
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Richfield man indicted for using business accounts to buy high-end vehicles, underpay taxes by $350,000Read the Press Release
A Richfield man was indicted on charges that he illegally failed to pay nearly $350,000 in income taxes by using a business account to pay personal expenses over nearly a decade, said Carole S. Rendon, United States Attorney for the Northern District of Ohio.
James M. Pelagalli, 60, was indicted on one count of attempt to evade or defeat payment of tax. Pelagalli used various business names and entities to conceal income and assets, according to the indictment.
For example, he used business accounts he controlled to pay for personal expenses, including the purchase of a 2008 Lamborghini Gallardo, lease payments on personal vehicles such as a 2010 Cadillac CTS, a 2010 Mercedes-Benz S550 sedan and a 2013 Cadillac XTS, and rental payments for a personal residence.
He failed to pay approximately $348,388 in income tax for calendar years 2002, 2003, 2005 through 2009, and 2011, according to the indictment
If convicted, the defendant’s sentence will be determined by the court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the Internal Revenue Service in Toledo. case is being prosecuted by Assistant United States Attorneys Noah P. Hood and Robert J. Patton.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Rhode Island Man Sentenced to 15 Years in Prison for Drug Trafficking and Money LaunderingRead the Press Release
BOSTON – A Rhode Island man was sentenced yesterday in U.S. District Court in Boston in connection with a wide-ranging conspiracy that distributed cocaine, heroin and other narcotics throughout Bristol County, Mass., and Rhode Island.
Luis Lopez a/k/a Juan Gonzalez, 43, of Tiverton, Rhode Island, was sentenced by U.S. District Court Judge Rya W. Zobel to 15 years in prison and five years of supervised release after pleading guilty in October 2016 to conspiracy to distribute cocaine, heroin and fentanyl and money laundering. Lopez also agreed to forfeit property worth over $1 million, including three properties in Rhode Island, a used car dealership based in Fall River, Mass., and a number of luxury vehicles.
From 2014 to 2016, Lopez imported, at a minimum, 50 to100 kilograms of cocaine from Puerto Rico to Massachusetts, and distributed it in New Bedford and Fall River with co-conspirators. Lopez also conspired with others to distribute heroin, fentanyl and acetylfentanyl. Lopez admitted that a kilogram of a fentanyl/acetylfentanyl mix that was found at a drug stash house in June belonged to him. Lopez also laundered drug proceeds through Hillside Auto, a used car business he purchased in Fall River in the name of a relative.
Acting United States Attorney William D. Weinreb; Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston; Fall River Police Chief Daniel S. Racine; and New Bedford Police Chief Joseph C. Cordeiro, made the announcement. Assistant U.S. Attorney Eric S. Rosen of Weinreb’s Narcotics and Money Laundering Unit is prosecuting the case.
Pueblo Man Sentenced to Federal Prison for Illegally Possessing FirearmsRead the Press Release
DENVER – Daniel Anthony Garcia, age 28, of Pueblo, Colorado, was sentenced today by U.S. District Judge Christine M. Arguello to serve 37 months in federal prison for felon in possession of a firearm, Acting U.S. Attorney Bob Troyer and ATF Acting Special Agent in Charge Ron Humphries announced. Following his prison sentence, Judge Arguello ordered the defendant to serve 3 years on supervised release. The defendant, in custody since his arrest on January 25, 2016, was remanded into the custody of the U.S. Marshals Service.
Garcia pled guilty to the charge on October 13, 2016.
According to court documents, including the stipulated facts contained in the defendant’s plea agreement, the defendant illegally entered an occupied home on December 6, 2015 and fired a gun to threaten the occupants after pistol whipping a man. One of the victims knew the assailant and identified him to the Pueblo Police Department. The shell casing from the gun was collected and sent to the National Integrated Ballistic Information Network for testing.
On January 25, 2016, Pueblo Police Department Officers sought the defendant at a residence in Pueblo. While at the location, officers outside the home observed the defendant bend over and appear to conceal an item under a bed inside the residence. A consent search allowed the officers to retrieve a .45-caliber pistol from under the bed, which NIBIN confirmed was used in the December 2015 home invasion using shell casings collected at a test fire.
Garcia was prohibited from possessing a firearm after having been convicted of a felony offense with a prison term of more than one year.
“There is an elite state and federal task force in Southern Colorado targeting gun violence,” said Acting U.S. Attorney Bob Troyer. “You use guns when you shouldn’t, and hell will be coming to breakfast.”
“Garcia would not have been under federal investigation if not for NIBIN,” said ATF Acting Special Agent in Charge Ron Humphries. “Thanks to the ballistics information from NIBIN and the stellar detective work by Pueblo PD and ATF, Garcia will not be able to terrorize the community for many years to come.”
The case was investigated by the ATF and Pueblo Police Department as part of the Southern Colorado Crime Gun Intelligence Center. The Southern Colorado Crime Gun Intelligence Center uses cutting-edge technology, such as NIBIN, and a dedicated investigative team to stop shooters and identify their sources of guns before they can commit further violent crimes. It is a partnership between ATF, Colorado Springs Police Department, El Paso Sheriff's Office, Fountain Police Department, Pueblo Police Department, Department of Corrections Division of Adult Probation, the U.S. Attorney's Office and the District Attorney's Office for the 4th and 10th Judicial Districts.
The defendant is being prosecuted by Assistant United States Attorney Kurt J. Bohn.
Pilot for Drug Trafficking Organization SentencedRead the Press Release
DALLAS — A former Dallas resident and member of the Jose Paz Garcia drug trafficking organization (DTO), who, after pleading guilty in 1995 to his role in a drug trafficking conspiracy, absconded, and remained a fugitive for 17 years, was sentenced today, announced U.S. Attorney John Parker of the Northern District of Texas.
Anthony Harrison Bell, a/k/a “Pajaro,” (Bird), 58, worked as a pilot for the Jose Paz Garcia DTO. Arrested in south Florida in 2013, Bell was sentenced today to 168 months in federal prison by Chief U.S. District Judge Barbara M. G. Lynn. He pleaded guilty in October 1995 to one count of conspiracy to possess with the intent to distribute and distribution of marijuana and cocaine.
Jose Paz Garcia, along with several coconspirators, was convicted at trial in the Northern District of Texas in May 1996. He was sentenced to serve life in federal prison.
According to Bell’s factual resume, from approximately June 1994 through early August 1995, Bell was employed by Jose Paz Garcia to fly quantities of marijuana and cocaine, for distribution and sale to others throughout the U.S., from El Paso, Texas, to Dallas. Bell would also transport drug proceeds, derived from Garcia from the sale of the marijuana and cocaine, from Dallas to Garcia and his associates in El Paso.
For example, Bell admits that on:
1) June 1, 1995, he used his Cessna 310L aircraft to transport 10 kilograms of cocaine from El Paso to Dallas for Garcia;
2) June 5, 1995, Bell, along with co-conspirator Miguel Robles, acquired approximately 140 pounds of marijuana from Garcia, and the next day Bell used his Cessna 310L aircraft to fly it to Nebraska, Colorado, and Ohio for redistribution;
3) June 30, 1995, Bell, along with Robles, acquired approximately 104 pounds of marijuana from Garcia, and Bell used his Cessna 210 aircraft to fly the marijuana from Dallas to Columbus, Ohio, for redistribution; and
4) July 12, 1995, Bell, using his Cessna 210 aircraft, flew approximately 173 pounds of marijuana from Dallas to Detroit for Garcia.
The Drug Enforcement Administration and the Federal Bureau of Investigation investigated the case. Assistant U.S. Attorney Joseph M. Revesz prosecuted.
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Pennsylvania man indicted on drug and firearms chargesRead the Press Release
A Pennsylvania man was indicted on drug and firearms charges, said Carole S. Rendon, U.S. Attorney for the Northern District of Ohio.
Michael Betts, 35, of New Castle, Penn., was charged with possession with the intent to distribute crack cocaine and heroin, and with being a felon in possession of a firearm and ammunition.
Betts possessed with the intent to distribute crack cocaine and heroin on Nov. 28, 2016, according to the indictment.
On the same date, Betts possessed a Sig Sauer, model 1911, .45 caliber pistol and ammunition, despite a prior conviction for assault with intent to do great bodily harm in Michigan in 2002, according to the indictment.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Salem Police Department. The matter is being prosecuted by Assistant U.S. Attorney David M. Toepfer.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Pain Management Physician Resolves False Claims Act AllegationsRead the Press Release
LEXINGTON, Ky. – Pain management physician Dr. Robert Windsor has agreed to the entry of a $20 million consent judgment to resolve allegations that he violated the False Claims Act by billing federal health care programs for surgical monitoring services that he did not perform and for medically unnecessary diagnostic tests. Dr. Windsor owned pain management clinics in Georgia and Kentucky that operated under the umbrella of National Pain Care, Inc., including clinics in Lexington, London, Somerset, Hazard, Prestonsburg, and Pikeville, Kentucky.
“Dr. Windsor placed personal gain above all else in his medical practice,” said Carlton S. Shier, IV, Acting U.S. Attorney for the Eastern District of Kentucky. “In doing so, he put his patients at risk, and defrauded the United States. We will use every tool at our disposal to protect vital healthcare programs from those who seek unearned profit at the taxpayers’ expense.”
“Windsor placed patients at risk by claiming that he was monitoring the neurological health of patients during surgery when he actually had an unqualified medical assistant do the work,” said John Horn, U. S. Attorney for the Northern District of Georgia. “Windsor unfortunately put his own interests above the health and safety of his patients.”
“Providing medically unnecessary services to a vulnerable population, such as Medicare beneficiaries, places patients at risk and jeopardizes millions of taxpayer dollars,” said Derrick Jackson, Special Agent in Charge of the U.S. Department of Health & Human Services, Office of Inspector General. “HHS-OIG is committed to safeguarding the federal health care programs and the patients receiving medical services. Today’s settlement should send a message to others who profit from schemes abusing patient safety that we will pursue justice for our beneficiaries and the programs.”
“The announced monetary settlement involving Dr. Robert Windsor is a direct result of several years of hard work by federal agents and prosecutors as they pursued and enforced rampant violations of the federal False Claims Act. The FBI continues to play a key role in identifying, investigating, and presenting for prosecution individuals such as Dr. Windsor who target and negatively impact our federal health care programs,” said David J. LeValley, Special Agent in Charge, FBI Atlanta Field Office.
“This settlement highlights the commitment of the Defense Criminal Investigative Service (DCIS) and its law enforcement partners to protect the integrity of the Department of Defense (DoD) health care program,” said Special Agent in Charge John F. Khin, Southeast Field Office. “DCIS aggressively investigates health care providers that defraud the DoD, to preserve American taxpayer dollars intended to care for our Warfighters, their family members, and military retirees.”
“The Georgia Department of Law will continue to work with our federal and local partners to pursue resolutions against those who threaten the medical care of Georgia citizens and misuse taxpayer dollars,” said Chris Carr, Attorney General for the State of Georgia.
The government alleges that Dr. Windsor engaged in two schemes. First, the government alleges that Dr. Windsor caused the submission of false claims to Medicare, TRICARE, and FEHBP for the online, real time intraoperative monitoring of surgeries that Dr. Windsor did not personally monitor, that were not monitored by a physician, and that Dr. Windsor falsely represented had been monitored by him during the period from January 1, 2008 through July 22, 2013. On October 24, 2016, Dr. Windsor was sentenced to three years, two months in federal prison and three years of supervised release in connection with this conduct.
The government also alleges that Dr. Windsor submitted or caused the submission of false claims to Medicare, the Georgia and Kentucky Medicaid programs, TRICARE, and FEHBP for medically unnecessary balance tests, nerve conduction and electromyography procedures, and qualitative drug screens performed in Georgia and Kentucky during the period from January 1, 2010 through June 30, 2014.
In order to satisfy the $20 million consent judgment, Dr. Windsor will sell all but one of his residential and commercial properties and pay the net sale proceeds to the government. Dr. Windsor will also sell certain other assets, including two boats and four jet skis, and pay the net sale proceeds to the government.
The settlement resolves two lawsuits filed by three whistleblowers, Kris Frankenberg, Stephanie Herder, and Bradley Davis, under the qui tam provisions of the False Claims Act. Under the Act, private citizens can bring suit on behalf of the government for false claims and share in any recovery. lawsuits resolved are captioned United States ex rel. Frankenberg v. Windsor et al., No. 1:12-cv-3114 (N.D. Ga.), and United States ex rel. Herder et al. v. National Pain Care, Inc., et al., No. 14-cv-00221 (E.D. Ky.).
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.
This case was investigated by the U.S. Attorney’s Office for the Northern District of Georgia, the U.S. Attorney’s Office for the Eastern District of Kentucky, the U.S. Department of Health & Human Services Office of Inspector General, the Federal Bureau of Investigation, the Defense Criminal Investigative Service, and the Kentucky Office of Attorney General’s Medicaid Fraud and Abuse Control Unit.
The civil settlement was reached by Assistant United States Attorneys Lena Amanti (Northern District of Georgia) and Paul McCaffrey (Eastern District of Kentucky).
Owner of Electrical Contracting Firms Received Two Year Prison Sentence for Tax FraudRead the Press Release
Joseph White, 48, of Newtown Pennsylvania was sentenced today to a 2-year term of imprisonment and ordered to pay $1.2 million in restitution by United States District Court Judge Gerald A. McHugh. The sentence arose from Joseph White’s guilty plea to a Criminal Information which charged him with willfully attempting to evade the payment of taxes announced Acting United States Attorney Louis D. Lappen.
According to the Criminal Information, Joseph White was the owner of PCE Electric Corporation and Thomas Edison Electric Corporation, located in Southampton, Pennsylvania from 2000 through 2011. The Criminal Information further charged that Joseph White diverted funds from his two corporations which he used for personal consumption without accounting, for tax purposes, for the income that he had diverted from his two corporations.
In addition to engaging in a corporate diversion scheme, the Criminal Information further charged that Joseph White registered the title to multiple vehicles that he purchased in the name of HAPPE, a partnership that he formed and registered with the Nevada Secretary of State. In addition to imposing a prison sentence up Joseph White, Judge McHugh ordered White to attend Gamblers Anonymous after he is released from prison while serving a period of supervised release.
“This sentence should send a clear message; schemes to evade the payment of taxes are a violation of the Federal Tax laws and the consequences of such schemes can and will result in jail time.” said Gregory Floyd, Acting Special Agent in Charge IRS Criminal Investigation, Philadelphia Field Office.
The case was investigated by the Internal Revenue Service’s Criminal Investigation Division Philadelphia Field and was prosecuted by Assistant United States Attorney Floyd J. Miller
Okmulgee Man Sentenced to 24 Months for Stealing Firearms from Licensed DealerRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that DILLAN JAMES PARKER, age 24, of Okmulgee, Oklahoma, was sentenced to 24 months imprisonment, and 3 years of supervised release for STEALING FIREARMS FROM A FEDERAL FIREARMS LICENSED DEALER, in violation of Title 18, United States Code, Sections 924(m) and 2.
The Indictment alleged that on or about May 12, 2016, within the Eastern District of Oklahoma, the defendant, did knowingly steal firearms from Richy’s Gun & Pawn, a federal licensed firearms dealer located in Checotah, Oklahoma.
The charge arose from an investigation by the Checotah Police Department, the Okmulgee Police Department, the Okmulgee District Attorney’s Office, the Okmulgee County Sheriff’s Office, the Muskogee County Sheriff’s Office, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
The Honorable Ronald A. White, District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearing. The defendant will remain in custody pending transportation to the designated federal facility at which the nonparoleable sentence will be served.
Assistant United States Attorney Dean Burris represented the United States.
Novi Restaurant Owner and Wife Plead Guilty to Harboring Undocumented WorkersRead the Press Release
The owner of a Novi restaurant and his wife pleaded guilty today to conspiracy and harboring undocumented workers for commercial advantage and private financial gain, announced United States Attorney Barbara L. McQuade.
McQuade was joined in the announcement by Acting Special Agent in Charge Steve Francis, U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) and Chief David Molloy, Novi Police Department.
Roger Tam, 56, and his wife, Ada Lei, 49, of Novi, entered their guilty pleas before U.S. District Judge Marianne O. Battani in Detroit.
"Today the principal defendants were convicted for using illegal labor to operate restaurants in metro Detroit," said Steve Francis, acting special agent in charge of HSI Detroit. "These guilty pleas should stand as a warning to employers who knowingly hire and employ illegal aliens that they will be held accountable for their actions.”
“These defendants are accepting responsibility for harboring undocumented workers and conspiracy, but we disagree about the appropriate sentencing guidelines that apply,” McQuade said. “At the sentencing hearing, the United States will seek a sentencing enhancement for creating a substantial risk of death or serious bodily injury to reflect the seriousness of the offense.”
According to court records, HSI special agents and officers with the Novi Police Department executed federal and state search warrants at a Novi residence owned by the Tams where five Mexican nationals died as a result of a fire that occurred on January 31, 2016. Department of Homeland Security databases revealed that all five men were illegally present in the United States.
Evidence obtained during the course of the investigation showed that the five Mexican nationals were hired by the defendants to work at their restaurant, Kim’s Garden, in Novi. As a benefit of their employment, the Mexican nationals resided at the couple’s Novi home and were transported to and from the restaurant for work. Tam admitted that the deceased individuals were employees at Kim’s Garden, that they were paid in cash, and that they were allowed to reside in the basement of Tam’s home.
The Tams each face up to 10 years in prison and a $250,000 fine. Sentencing has been set for June 13, 2017.
This case was investigated by the Novi Police Department and HSI with assistance from ICE’s Enforcement and Removal Operations (ERO), U.S. Customs and Border Protection’s Border Patrol and the Oakland County Sherriff’s Office
New Hampshire Asbestos Abatement Company Pleads Guilty to Defrauding Union Benefit FundsRead the Press Release
BOSTON – An asbestos removal company pleaded guilty today in connection with an illegal “double breasted shop” scheme aimed at enabling them to defraud the Massachusetts Laborers Benefit Fund (MLBF). In this case, the company utilized a second corporate entity to pay union members at non-union rates without union benefits.
AQE, Inc. of Windham, NH, pleaded guilty to 18 counts of mail fraud, one count of benefit fund embezzlement, and 18 counts of filing false documents with an ERISA fund, after being indicted in January of 2016. U.S. District Court Judge Patti B. Saris scheduled sentencing for May 4, 2017.
AQE, Inc. employed members of the Tewksbury Local 1421 of the Laborers International Union of North America. It paid members of Local 1421 for jobs which required union participation from the AQE, Inc. payroll which was a union signatory corporation. When the jobs did not require a union signatory company, union members were paid from the payroll of Air Quality Experts, Inc.—a separate entity used as part of AQE, Inc.’s single business. In these instances, union members did not receive union rates, and benefits were not paid by AQE, Inc. to the MLBF, which provides medical and pension benefits to 8,000 laborers and their families in Massachusetts. AQE, Inc. sent “remittance reports” to the MLBF which failed to report thousands of hours worked by members of Local 1421. By significantly under reporting the hours worked by union members, AQE, Inc. failed to pay hundreds of thousands of dollars to the MLBF.
AQE, Inc. has agreed to pay $500,000 in restitution to the MLBF as part of the plea.
The charging statutes each provide for a sentence of at least one year, and no greater than five years of probation, a fine of $500,000 or twice the loss or gain from the offense, and restitution. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney William D. Weinreb; Cheryl Garcia, Special Agent in Charge of the Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigation, New York Region; and Susan Hensley, Regional Director of the Department of Labor, Employee Benefits and Security Administration, made the announcement today. Assistant U.S. Attorneys Fred M. Wyshak, Jr. and Ryan M. DiSantis, of Weinreb’s Public Corruption Unit, are prosecuting the case.
Muskogee Man Sentenced to 24 Months for Firearm PossessionRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that TRAVIS DANIEL PHILLIPS, age 37, of Muskogee, Oklahoma, was sentenced to 24 months imprisonment, and 36 months of supervised release for FELON IN POSSESSION OF FIREARM, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(2).
The Indictment alleged that on or about January 19, 2016, within the Eastern District of Oklahoma, the defendant, having been convicted of a crime punishable by imprisonment for a term exceeding one year, did knowingly possess in and affecting commerce, a firearm which had been shipped and transported in interstate commerce.
The charge arose from an investigation by the Muskogee Police Department, and the Federal Bureau of Investigation.
The Honorable Ronald A. White, District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearing. The defendant will remain in custody pending transportation to the designated federal facility at which the nonparoleable sentence will be served.
Assistant United States Attorney Rob Wallace represented the United States.
Morristown Resident Sentenced to 262 Months in Federal Prison for Role in Methamphetamine ConspiracyRead the Press Release
GREENEVILLE, Tenn. – On Jan. 31, 2017, Jason Wayne Helton, a.k.a. Crack Baby, 33, of Morristown, Tenn., was sentenced by the Honorable R. Leon Jordan, U.S. District Court Judge, to serve 262 months in federal prison following a conviction for his role in a conspiracy to distribute methamphetamine in east Tennessee.
According to his plea agreement on file with U.S. District Court, Helton sold quantities of methamphetamine to an individual working on behalf of law enforcement on three occasions between December 2015 and March 2016. In February 2016, a federal search warrant was executed at a residence in Stone Mountain, Ga., where Helton was present and scheduled to obtain and transport an ounce and a half of methamphetamine back to Tennessee. Another federal search warrant was executed at Helton’s residence in Morristown in March 2016 which resulted in the seizure of an additional quantity of methamphetamine.
Law enforcement agencies participating in the investigation included the Federal Bureau of Investigation, Grainger County Sheriff’s Office, Hamblen County Sheriff’s Office, Morristown, Tennessee Police Department and the Third and Fourth District Judicial Drug Task Forces. Assistant U.S. Attorney Wayne Taylor represented the United States.
This case was a result of the Department of Justice’s Organized Crime and Drug Enforcement Task Force (OCDETF) program, the centerpiece of the Department of Justice’s drug supply reduction strategy. OCDETF was established in 1982 to conduct comprehensive, multi-level attacks on major drug trafficking and money laundering organizations. Today, OCDETF combines the resources and expertise of its member federal agencies in cooperation with state and local law enforcement. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking and money laundering organizations and those primarily responsible for the nation’s drug supply.
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Moline Man Charged with Falsifying Records, Making False Statements Under Oath in Bankruptcy ProceedingsRead the Press Release
ROCK ISLAND, Ill. -- A Moline, Ill., man, Samir A. Patel, 48, made his initial appearance in federal court today on bankruptcy fraud charges. Patel, of the 3600 block of 73rd Street, was arrested yesterday. U.S. Magistrate Judge Stephen B. Jackson, Jr., ordered that Patel remain detained pending a detention hearing on Feb. 6. Trial was set on Mar. 27, in Peoria, before Chief U.S. District Judge James E. Shadid.
According to the indictment, in June 2013, Patel filed a bankruptcy petition in the Central District of Illinois to discharge his debts under Chapter 7 of the U.S. Bankruptcy Code. The indictment alleges that in August and September 2013, Patel provided the Bankruptcy Trustee with altered bank statements and summaries of his bank account.
The indictment also alleges that Patel falsely testified under oath in a bankruptcy proceeding, a September 2013 meeting of creditors, that a $5,000 wire transfer deposit into his account was a loan from a friend of his wife to help the couple pay living and business expenses. As alleged in the indictment, the deposit was actually a $315,000 wire transfer from a law firm related to a business transaction and which Patel was attempting to conceal from creditors and the Bankruptcy Trustee.
The charges resulted from a referral by the U.S. Trustee for Indiana and Central and Southern Illinois (Region 10) to the U.S. Attorney for the Central District of Illinois. The charges were investigated by the U.S. Postal Inspection Service and the IRS Criminal Investigation Division, in collaboration with the Central Illinois Bankruptcy Fraud Working Group coordinated by the U.S. Trustee. Assistant U.S. Attorney John K. Mehochko is prosecuting the case.
“This case is an example of the collaborative efforts of the Bankruptcy Fraud Working Group and other law enforcement partners to combat fraud and abuse in our nation’s bankruptcy system,” stated Nancy J. Gargula, U.S. Trustee for Central Illinois, Southern Illinois and Indiana (Region 10.) “I am grateful to Acting U.S. Attorney Hansen and our law enforcement partners for their strong commitment to combating fraud and abuse in bankruptcy cases.”
If convicted, the statutory penalty for each count of altering records in bankruptcy (seven counts) is up to 20 years in prison; for falsification of records in bankruptcy (one count) and making false statements under oath in bankruptcy proceedings (one count) the penalty is up to five years in prison. The maximum statutory penalty for each offense charged is prescribed by Congress and is provided for informational purposes as sentencing is determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Members of the public are reminded that an indictment is merely an accusation; the defendant is presumed innocent unless proven guilty.
The U.S. Trustee Program is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. Region 10 is headquartered in Indianapolis, with additional offices in South Bend, Ind., and Peoria, Ill.
Miami Resident Sentenced to Prison in Stolen Identity Tax Fraud SchemeRead the Press Release
Defendant’s mother, a postal employee, provided him with stolen tax refund checks from the mail
A Miami resident was sentenced to 24 months in prison, to be followed by four years of supervised release, for his participation in stolen identity tax fraud scheme.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Max Eamiguel, Special Agent in Charge, U.S. Postal Service, Office of Inspector General (USPS-OIG), Rick Maglione, Chief, Fort Lauderdale Police Department, and Timothy Camus, Deputy Inspector General for Investigations, Treasury Inspector General for Tax Administration (TIGTA), made the announcement.
David Earl Tucker, 30, of Miami, previously pled guilty to one count of conspiracy to commit an offense against the United States, in violation of Title 18, United States Code, Section 371, and one count of aggravated identity theft, in violation of Title 18, United States Code, Section l028A(a)(1).
According to court documents, during a traffic stop of a vehicle that Tucker was driving, the defendant presented law enforcement with a fake Texas driver's license in another person's name. Tucker was taken into custody, and a tax refund Treasury check in another individual’s name was found during an inventory search of the vehicle. Further investigation revealed that the tax refund check was stolen by a postal employee, Tara Marshea Tucker, 47, of Miami, the mother of David Tucker.
According to court records, Tara Tucker stole mail while in the performance of her duties as a postal employee. On separate occasions, Tara removed two tax refund Treasury checks and gave them to her son, David Tucker. Tara Tucker was supposed to receive a percentage of each check that she gave to her son. Tara Tucker improperly removed a total of 4 to 5 checks from the mail stream.
Tara Tucker previously pled guilty to one count of conspiracy to commit an offense against the United States, in violation of Title 18, United States Code, Section 371. On November 2, 2016, Tara Tucker was sentenced to 4 months in prison and 4 months of home confinement, to be followed by two years of supervised release.
The intended loss amount for the scheme was $12,139.16.
Mr. Ferrer commended the investigative efforts of IRS-CI, USPS-OIG, Fort Lauderdale Police Department and TIGTA. The case was prosecuted by Assistant U.S. Attorneys Joshua S. Rothstein, Ilham A. Hosseini and Anne P. McNamara.
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.
Mexican national pleads guilty to federal drug crimeRead the Press Release
HUNTINGTON, W.Va. – A Mexican national pleaded guilty today to a federal drug crime, announced United States Attorney Carol Casto. Moises Gamboa, 52, of Rocky Point, Mexico, entered his guilty plea to aiding and abetting the possession with intent to distribute 100 kilograms or more of marijuana.
Gamboa admitted that in 2010, while in Mexico, he arranged for the transportation of 660 pounds of “very good marijuana” to Nitro. The drugs were to be concealed in the walls of a motorcycle trailer. Gamboa also admitted that he informed an individual cooperating with law enforcement that the driver would make contact to set up a meeting. The driver subsequently told the cooperating individual that he would be arriving in West Virginia on March 5, 2010. When the driver arrived in Nitro, law enforcement seized the marijuana hidden in the motorcycle trailer.
Gamboa faces up to 40 years in federal prison when he is sentenced on May 22, 2017.
This prosecution was made possible through the cooperative efforts of several investigating agencies, including the Putnam County Sheriff’s Department, the Metropolitan Drug Enforcement Network Team, the Muskingum County Sheriff’s Department in Ohio, the United States Marshals Service, the Kentucky State Police, the Indiana State Police, the Huntington Police Department, and the Policia Federal Ministerial of Mexico. Several Drug Enforcement Administration agents investigated this case, including agents from Charleston, Columbus, Phoenix, Tucson, Chicago, Denver, and Hermosillo, Mexico.
Assistant United States Attorney Monica D. Coleman is in charge of the prosecution. The plea hearing was held before Chief United States District Judge Robert C. Chambers.
This case is part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of illegal drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down pill trafficking, eliminating open air drug markets, and curtailing the spread of illegal drugs in communities across the Southern District.
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Mexican Citizen Travelling in Las Vegas Sentenced to 10 Years for Possession of HeroinRead the Press Release
LAS VEGAS, Nev. – A Mexican citizen who was stopped for a traffic violation and subsequently found with heroin concealed in his vehicle was sentenced today to 120 months in prison, announced United States Attorney Daniel G. Bogden of the District of Nevada.
“The defendant concealed the heroin in different locations in his vehicle including a bean bag chair. Along with the work of our law enforcement partners, the U.S. Attorney’s Office is committed to preventing illegal drugs hitting our streets,” said U.S. Attorney Bogden.
According to court documents, in April 2015, Jesus Antonio Diaz-Flores, 37, was stopped for a traffic violation on I-15, near mile marker 60, by a Nevada Highway Patrol Trooper. Following Diaz-Flores’s consent to search the vehicle, a narcotics detector dog alerted the trooper who recovered five bundles containing a brownish-black tar-like substance hidden inside PVC pipe and a bean bag chair in the vehicle. The bundles were sent to the Las Vegas Metropolitan Police Department lab where the contents tested positive for heroin and weighed 2494.90 grams or approximately 5.5 pounds. Diaz-Flores admitted that he knew he was transporting heroin and that the heroin would later be distributed to other individuals.
Diaz-Flores was charged on April 21, 2015, and he pleaded guilty on July 11, 2016.
The case was investigated by the Drug Enforcement Administration and the Nevada Highway Patrol; and prosecuted by Assistant U.S. Attorney Susan Cushman.
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Mescalero Apache Man Sentenced to Prison for Escaping from Half-Way House and Failing to Update Sex Offender RegistrationRead the Press Release
ALBUQUERQUE – Tyree Brent Mariano, 26, an enrolled member of the Mescalero Apache Nation residing in Albuquerque, N.M., was sentenced today in federal court to 21 months in prison followed by three years of supervised release for escaping from a half-way house and violating the Sex Offender Registration and Notification Act (SORNA). Mariano will also be required to register as a sex offender when he completes his prison sentence.
SORNA, also known as the Adam Walsh Protection and Safety Act, requires that a convicted sex offender register in each jurisdiction where the offender resides, where the offender is employed, or where the offender is a student, and that the sex offender maintain current registrations.
Mariano was arrested on May 21, 2016, on an indictment charging him with violating SORNA by failing to update his sex offender registration and escaping from a half-way house where he was confined following his conviction on a child sexual abuse charge. According to the indictment Mariano failed to update his registration between July 8, 2015 and March 8, 2016, in Bernalillo County, N.M.
On Aug. 3, 2016, Mariano pled guilty to the indictment. In entering the guilty plea, Mariano admitted that he was a sex offender as a result of his child sexual abuse conviction on April 19, 2012. On June 11, 2015, Mariano registered as a sex offender with the Bernalillo County Sheriff’s Office and was residing in a halfway house in Albuquerque as a condition of his supervised release following his release from prison. Mariano admitted that on June 27, 2015, he left the halfway house without permission and did not return. He further admitted that he did not notify the Sheriff’s Office of his change of residence as required under SORNA when he absconded from the halfway house.
This case was investigated by the U.S. Marshals Service and the Bernalillo County Sheriff’s Office. Assistant U.S. Attorney Alexander B. Shapiro of the U.S. Attorney’s Las Cruces Branch Office prosecuted the case.
Mescalero Apache Man Sentenced for Federal Arson ConvictionRead the Press Release
ALBUQUERQUE – Theodore George Torres, 28, an enrolled member of the Mescalero Apache Nation who resides in Mescalero, N.M., was sentenced today in federal court in Las Cruces, N.M., to 36 months in prison followed by three years of supervised release for his conviction on an arson charge. Torres also was ordered to pay restitution in the amount of $86,299.42 to the victim of his criminal conduct.
Torres was arrested on Dec. 15, 2015, on a federal criminal complaint charging with arson, and was indicted on that same charge on April 21, 2016. According to court filings, Torres set fire to the residence of a Mescalero Apache woman. Torres committed the crime on Oct. 30, 2014, on the Mescalero Apache Indian Reservation in Otero County, N.M. Torres previously had been arrested on related tribal charges on Dec. 11, 2014, and remained in tribal custody until his arrest on the federal arson charge.
On July 12, 2016, Torres pled guilty to the indictment, and admitted that on Oct. 30, 2014, he maliciously set fire to a dwelling located in Mescalero Apache Reservation. Torres acknowledged that the fire caused $86,299.42 worth of damage.
This case was investigated by the Mescalero Agency of the BIA’s Office of Justice Services and was prosecuted by Assistant U.S. Attorney Aaron O. Jordan of the U.S. Attorney’s Las Cruces Branch Office.
The case was brought pursuant to the Tribal Special Assistant U.S. Attorney (Tribal SAUSA) Pilot Project in the District of New Mexico, which is sponsored by the Justice Department’s Office on Violence Against Women under a grant administered by the Pueblo of Laguna. The Tribal SAUSA Pilot Project seeks to train tribal prosecutors in federal law, procedure and investigative techniques to increase the likelihood that every viable violent offense against Native women is prosecuted in either federal court or tribal court, or both. The Tribal SAUSA Pilot Project was largely driven by input gathered from annual tribal consultations on violence against women, and is another step in the Justice Department's on-going efforts to increase engagement, coordination and action on public safety in tribal communities.
Martinsville Man Sentenced on Child Pornography ChargesRead the Press Release
Danville, VIRGINIA – A Martinsville man, who produced images and videos of himself raping a four-year-old girl, was sentenced yesterday in the United States District Court for the Western District of Virginia in Danville, Acting United States Attorney Rick A. Mountcastle announced.
Mario Ahlazshuna Dillard, 31, of Martinsville, Va., previously pled guilty to three counts of production of child pornography and one count of receipt and distribution of child pornography. Yesterday in District Court, Dillard was sentenced to 35 years in federal prison, followed by lifetime supervised release.
According to evidence presented at today’s hearing by Assistant United States Attorney Laura D. Rottenborn, and at previous hearings, Dillard was a high-volume viewer of child pornography and a member of multiple websites that allowed him to access, download and distribute child pornography. However, Dillard’s obsession with child pornography did not stop with simply viewing images. On many separate occasions he filmed himself sexually assaulting a 4-year-old girl he cared for on a regular basis.
Law enforcement recovered at least four separate videos depicting these sexual assaults. One such video, which showed the victim performing oral sex on Dillard while cartoons played in the background, was distributed by the defendant on June 9, 2015, via the media sharing application, WhatsApp Messenger.
The investigation of the case was conducted by the Federal Bureau of Investigation with the assistance of the Henry County Sheriff’s Office. Assistant United States Attorneys Laura D. Rottenborn and Daniel Bubar prosecuted the case for the United States.
Marrero Woman Charged with $536,724 in Health Care FraudRead the Press Release
U.S. Attorney Kenneth A. Polite announced that MONICA SYLVEST, age 52, of Marrero, was charged today in a Bill of Information for health care fraud.
According to the Bill of Information, SYLVEST worked as a Practice Administrator for a local pediatric clinic from August 2014 through September 2016. During her employment, SYLVEST embezzled and diverted to her personal use approximately $536,724 in medical reimbursements from the Medicaid program in connection with the delivery of and payment for health care benefits, items, and services paid to the clinic. As the Practice Administrator, SYLVEST utilized a business credit card issued by American Express and made over $536,000 in unauthorized charges to purchase several luxury items including a Harley Davidson motorcycle, custom diamond jewelry, and collectible artwork. SYLVEST then accessed her employer’s bank account containing the Medicaid reimbursements to make transfers and payments to cover the illegal purchases. The Bill of Information further alleges SYLVEST disguised the payments made to American Express as “biologicals” or “vaccinations” in order to make it appear that the expenses were related to the normal operations of the clinic.
If convicted, SYLVEST faces a sentence of up to ten years imprisonment, followed by a term of supervised release of up to three years, and a $250,000.00 fine.
U.S. Attorney Polite reiterated that a Bill of Information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the Federal Bureau of Investigation in investigating this matter. The prosecution of this case is being handled by Fraud Section Chief, Assistant U.S. Attorney Brian M. Klebba.
Manchester Man Pleads Guilty to Bank RobberyRead the Press Release
CONCORD, N.H. – United States Attorney, Emily Gray Rice announced that Ryan Freeman, 27, of Manchester, New Hampshire, pleaded guilty in federal court today to one count of bank robbery.
Information based on court filings and statements made at the change of plea hearing established that Freeman entered the TD Bank on South River Road in Bedford, New Hampshire on July 26, 2015. He approached a teller, demanded $10,000, and threatened to blow her brains out if she did not comply. The teller provided a sum of money to Freeman and he left the bank. Witnesses saw him leave the bank in a gold Volvo, which was later recovered after being abandoned near Exit 4 on Interstate 293. Images from the bank clearly established that Freeman committed the robbery.
A sentencing hearing has been scheduled for March 1, 2017 at 11:00 a.m.
The case was investigated by the Bedford Police Department with the assistance of the Manchester Police Department, the New Hampshire State Police Forensics Laboratory, and the Federal Bureau of Investigation. case was prosecuted by Assistant United States Attorney Don Feith.
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Local Woman Sentenced and Ordered to Pay $1.8 Million for Complex Fraud SchemeRead the Press Release
Assistant U. S. Attorney Christopher P. Tenorio (619) 546-8413
NEWS RELEASE SUMMARY – January 30, 2017
SAN DIEGO – Deborah Tumlinson of Valley Center was sentenced yesterday to a year and a day in custody for her participation in a fraudulent scheme devised after the 2007 Witch Creek Wildfire. U.S. District Judge Janis L. Sammartino also ordered Tumlinson to pay restitution in the amount of $1,838.742.24.
On May 13, 2016, Tumlinson pleaded guilty to a wire fraud scheme that ran from May 2010 to April 2013. Part of the scheme involved obtaining loan proceeds from U.S. Claims (Lifeline Funding, LLC), a funding company based in Moorestown, New Jersey that provides loans for individuals who can use expected or actual lawsuit proceeds as collateral. To obtain a loan from U.S. Claims in the amount of $750,000, Tumlinson made false representations, and caused others to do the same.
On May 20, 2010, Tumlinson caused her attorney, Carter Johnston, to send a letter to her real estate broker, which misrepresented that Tumlinson and her husband had reached a settlement in their pending lawsuit against SDG&E. The lawsuit (Edward Malone, et al. v. SDG&E, et al., Case No. 37-2008-00081779-CU-PO-CTL in San Diego Superior Court) was based on allegations that the Tumlinsons’ former residence in Ramona, California, was damaged by the Witch Creek Wildfire on October 21, 2007. Tumlinson caused Johnston to send a second letter to her real estate agent on September 30, 2010, which misrepresented that the Tumlinsons had obtained funding for the purchase of a new residence in Valley Center, California. Mr. Johnston has since been disbarred by the State of California.
On October 2, 2010, Tumlinson caused Johnston to send a letter to U.S. Claims, misrepresenting that the Tumlinsons had settled the SDG&E lawsuit for $2,490,000. Three days later, Tumlinson falsely told U.S. Claims that a court-appointed mediator in the SDG&E lawsuit had already awarded $2.4 million to the Tumlinsons. The next day, the Tumlinsons signed a Purchase Agreement in support of a U.S. Claims loan application. The Purchase Agreement falsely provided that Johnston represented the Tumlinsons in connection with their “settled claim” in the SDG&E lawsuit when, in fact, they were represented at that time by other attorneys, and no settlement had been obtained which could be used as collateral to secure the U.S. Claims loan. The Tumlinsons received a loan from U.S. Claims in the amount of $750,000, which they never repaid.
After receiving the loan proceeds from U.S. Claims, Tumlinson wire-transferred $550,000 into escrow on October 8, 2010, for the purchase of the Valley Center property. Using the equity from the Valley Center property, Tumlinson sought a new loan from Seaside Funding Inc., a mortgage broker, based in Carlsbad, California. In December 2010, Tumlinson signed, and caused her husband to sign, Seaside Funding loan documents for a $250,000 home-equity loan. The application and supporting documents falsely represented that the Tumlinsons did not intend to live in the Valley Center property as their primary residence, and that it would be used as a rental property that generated income necessary to make loan payments. As a result of the misrepresentations, Seaside Funding funded the requested loan, which the Tumlinsons never repaid. The loan proceeds were later recovered when Seaside Funding foreclosed on the Valley Center property.
At sentencing, Judge Sammartino noted that Tumlinson’s property did receive some damage from the 2007 fire, but that her subsequent actions made her “pain and anguish spread to others.”
“The defendant suffered losses during a terrible wildfire, like many others did,” said Acting U.S. Attorney Alana W. Robinson. “But she exploited her own tragedy and the compassion of others, and in the process made sure it became someone else’s tragedy, too. The people she fleeced paid a high price, and for that, she will pay a high price.”
Special Agent in Charge Eric S. Birnbaum said, “The San Diego Division of the FBI remains committed to uncovering these complex fraud schemes and bringing those to justice who would attempt to cheat the banking system for personal gain.”
DEFENDANT Case Number: 14CR2978-JLS
Deborah Tumlinson Age: 55
SUMMARY OF CHARGE
Title 18, United States Code, Section 1343 (Wire Fraud Scheme)
Maximum penalty: 20 years of custody; $100,000 Fine
AGENCY
Federal Bureau of Investigation
Littleton Woman Pleads Guilty for Oil Investment SchemeRead the Press Release
DENVER – Jill M. Evans, age 51, of Littleton, Colorado, recently pled guilty before U.S. District Court Judge John L. Kane to wire fraud and money laundering charges announced the United States Attorney’s Office, IRS – Criminal Investigation (IRS-CI) and the Federal Bureau of Investigation (FBI). Evans was indicted by a federal grand jury on May 21, 2015.
According to the indictment and plea agreement, in September 2011 and continuing through May 2015, Evans devised a scheme to defraud at least eight individuals whom she solicited to invest in alleged oil transactions. Evans informed or caused others to inform potential investors that she or one of her companies, Paramount Mortgage or Evcom, had rights or agreements related to the purchase and resale of petroleum products, including diesel oil or jet fuel. She claimed that the oil deals could not be completed until certain fees or other expenses related to the deals could be paid.
Evans falsely told investors they would receive a return on their investment ranging from fifty percent to fifty times their original investment within a matter of days or weeks. She told investors that their funds would be held in an escrow account and would be fully refundable if the oil deal did not close. Evans instructed investors to transfer funds to bank accounts. Some investors’ funds were not used as represented and were also sent to personal bank accounts that Evans controlled. Of those funds transferred to personal accounts she controlled, she used those funds for her own personal expenses.
She would tell investors that oil deals were nearing successful completion and that disbursements of profits were imminent. She sent e-mails attaching fabricated court documents regarding the status of civil litigation purporting to award Evans or related parties substantial sums of money. When the oil deals failed to close, she told investors that she would be able to pay investors from these proceeds.
Furthermore, Evans concealed from investors her December 2011 criminal indictment by a State of Colorado grand jury and her subsequent March 2013 criminal conviction for theft and forgery. Evans’s bond conditions prohibited her from entering into any financial transactions in excess of $1,000, and the terms of her subsequent state sentence prohibited her from investing money, entering into any financial contracts or arrangements, and having access to or control of any funds of any individual.
Evans pled guilty to one count of wire fraud and one count of money laundering. Wire fraud carries a penalty of not more than 20 years in federal prison, and a fine of up to $250,000. Money laundering carries a penalty of not more than 10 years in federal prison, and a fine of up to $250,000. Evans plea agreement stipulates restitution for this case is $2,094,500. Evans is scheduled to be sentenced by Judge Kane on April 21, 2017.
This case was investigated by IRS – Criminal Investigation and the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Anna K. Edgar.
Leader of Heroin Trafficking OrganizationRead the Press Release
WILMINGTON – The United States Attorney’s Office announced today that ROBERT BOONE, 43, of Leland, North Carolina, was sentenced in federal court to 360 months imprisonment after having previously been convicted of conspiracy to distribute one kilogram or more of heroin and conspiracy to launder monetary instruments.
An investigation by federal and state law enforcement agencies revealed that BOONE operated a large scale drug trafficking organization (“DTO”) in his hometown of Paterson, NJ, which BOONE relocated to Wilmington, NC around 2012. From 2012 to 2015, the DTO “flooded” Wilmington with kilogram quantities of heroin. Couriers were employed to transport the heroin and heroin proceeds between New Jersey and Wilmington. The DTO utilized multiple bank accounts, wire transfers, and prepaid debit cards to launder hundreds of thousands of dollars in drug proceeds.
Multiple co-conspirators were charged and have already been sentenced in federal court in connection with this prosecution:
AARON VEAL was convicted of conspiracy to distribute heroin and sentenced to 60 months imprisonment. JAMES TOWNSEND was convicted of conspiracy to distribute heroin and sentenced to 84 months imprisonment. CRAIG DENSON was convicted of conspiracy to distribute heroin and sentenced to 180 months imprisonment. LARRY K. JOHNSON was convicted of money laundering conspiracy and sentenced to 96 months imprisonment. CHRISTOPHER ANTUAN JONES was convicted of conspiracy to distribute heroin and sentenced to 105 months imprisonment. DANIELLE JONES was convicted of conspiracy to distribute heroin and sentenced to 78 months imprisonment. SYRJAH KASHIK ALSTON was convicted of conspiracy to distribute heroin and money laundering conspiracy and sentenced to 96 months imprisonment. TAKEYAH ONI BAKER was convicted of money laundering conspiracy and sentenced to 42 months imprisonment. OCTABIA LAUREN BOONE was convicted of money laundering conspiracy and sentenced to 42 months imprisonment. FELICIA HALL was convicted of operating an unlicensed money transmitting business and sentenced to 3 years probation.
This case was brought as a part of an Organized Crime Drug
Enforcement Task Force (OCDETF) Operation entitled WoofPack,
investigating importers and multi-level distributors of heroin,
cocaine, crack cocaine and gang activity associated with this
DTO.
Investigation of this case was conducted by the Federal Bureau of Investigation – Wilmington Safe Streets Task Force, the Wilmington Police Department, the New Hanover County Sheriff’s Office, the North Carolina State Highway Patrol, the Sampson County Sheriff’s Office, and the Virginia State Police. Assistant United States Attorney Toby Lathan handled the prosecution on behalf of the Eastern District of North Carolina.
Lead Defendant in Series of Robberies, Kidnappings Pleads GuiltyRead the Press Release
Charlottesville, VIRGINIA – A Greene County man, who along with others committed a series of armed and violent robberies across Albemarle and Greene counties, pled guilty today in the United States District Court for the Western District of Virginia in Charlottesville to federal firearms charges, Acting United States Attorney Rick A. Mountcastle announced.
Terence Tyree, 19, of Greene County, Va., pled guilty to two counts of using and carrying a firearm during and in relation to a crime of violence. Tyree faces a mandatory minimum sentence of 30 years in federal prison when he is sentenced April 12, 2017.
Tyree and five others were indicted late last year following a series of violent, armed robberies and kidnappings at local pizza chain restaurants, convenience stores, and a private residence in Albemarle and Greene County. Tyree is the second defendant directly involved in multiple robberies to plead guilty in federal court.
According to evidence presented at today’s hearing by Assistant United States Attorney Christopher Kavanaugh, Tyree admitted that he participated in a robbery of the Papa John’s Pizza on Seminole Trail in Greene County in the early morning hours of June 9, 2016. Surveillance footage and victim testimony would have shown that Tyree and the other two men dressed all in black, carried firearms and covered their faces in masks. They entered the store, displayed their weapons for the employees and demanded cash. The defendants stole cash and one employee’s cell phone.
Less than 10 days later, on June 17, 2016, Tyree and a co-defendant returned to the same Papa John’s Pizza and robbed it at gunpoint, again.
In addition, Tyree admitted today that he and others robbed Domino’s Pizza on Towncenter Lane in Albemarle County on June 27, 2016. In this instance, Tyree and a co-defendant entered the store, dressed in all black with their faces covered with masks. Inside the store, Tyree pointed his firearm at a store employee while his co-defendant, Kentavia Jones grabbed cash and cell phones.
Tyree also admitted that on July 7, 2016 he participated in the robbery of the Domino’s Pizza on Ford Avenue in Greene County. Once at the location, Tyree and another man put masks on their faces, got out of their vehicle, and ran into the store. As in the previous robbery, Tyree pointed his gun at store employees as his co-defendant, Kentavia Jones. As the defendants were running back to the car, a witness said something to the defendants, at which time one of the co-defendants fired a single shot into the air.
On July 18, 2016, Tyree and two co-defendants went to an Albemarle County home to commit an armed robbery, Tyree admitted in court today. The victim was inside, alone, when he heard a loud explosion. When he went to the living room, the victim saw that a propane tank had been thrown through his glass door and three masked individuals, dressed in all black, were in his living room, one of whom was armed with a pistol. Inside the house, the defendants ordered the victim to face the wall as they proceeded to ransack the house. As they were getting ready to leave, the defendants struck the victim in the head, causing him to fall to the floor. Once on the floor, Tyree and the others struck the victim again.
Tyree and the two co-defendants then commanded the victim, at gunpoint, to get into the back seat of his Lexus vehicle, which was then parked in the victim’s garage. All three defendants got into the car, with Tyree in the driver’s seat, and drove to a nearby ATM machine at the Wells Fargo bank located at the intersection of Route 29 and Airport Road in Albemarle County. Upon arrival at the bank, the defendants told the victim to get as much money as he could and return to the car. At that time, however, a second victim was observed in the bank parking lot, having just come from the nearby airport with his luggage still in hand. Tyree’s co-defendant got out of the car, pointed his gun at the traveling passerby, and ordered him to also get into the car. The second victim complied. The victim attempted to get money from the ATM machine but could not, so the victim was ordered to get back into the car.
Tyree then drove his co-defendants and the victims to a nearby 7-11 store. He parked the car, and then went inside and robbed the clerk at gunpoint. Jones drove everyone away from the scene. Soon thereafter, in a nearby neighborhood, the defendants stopped the car and told both victims to get out of the car and both victims complied. The defendants drove away. The defendants later abandoned the vehicle, which was ultimately recovered by law enforcement.
The investigation of the case was conducted by the Federal Bureau of Investigation, the Albemarle County Police Department and the Greene County Sheriff’s Office. Assistant United States Attorneys Christopher Kavanaugh and Ronald M. Huber are prosecuting the case for the United States.
Las Vegas Man Sentenced to Life in Prison for Murdering Drug Supplier During 2013 Marijuana TransactionRead the Press Release
LAS VEGAS, Nev. – Louis Matthews, 35, was sentenced today to life in prison for drug and firearm crimes that resulted in the death of a man during a drug deal at a North Las Vegas apartment in November 2013, announced U.S. Attorney Daniel G. Bogden of the District of Nevada and Special Agent in Charge Jill Snyder of the ATF. United States District Judge James C. Mahan also sentenced Matthews to 10 additional years in prison and five years of supervised release.
“Our United States Attorney’s Office and all our law enforcement partners remain vigilant in efforts to identify violent crime and we will continue to combat it head on to keep our communities safe. As in this case, we will work with our law enforcement partners to address and prevent violent crime issues. We remain committed to pursuing justice for all victims,” said U.S. Attorney Bogden.
“This case is an example of the hard work the Las Vegas Metropolitan Police Department, North Las Vegas Police Department and ATF agents do on a daily basis to protect the public from armed drug traffickers who threaten our neighborhoods,” said ATF Special Agent in Charge Jill Snyder. “At ATF, our goal is to protect our communities from violent criminals, criminal organizations, the illegal use and trafficking of firearms, the illegal use and storage of explosives, acts of arson and bombings, acts of terrorism, and the illegal diversion of alcohol and tobacco products. One of the ways ATF is able to do that is through the successful partnerships we have with other agencies.”
Following a seven-day trial, Matthews was convicted by a jury on Oct. 12, 2016, of one count of conspiracy to possess marijuana with intent to distribute and one count of using a firearm during and in relation to a drug trafficking crime resulting in death.
According to the court records, on Nov. 30, 2013, Matthews and John Thomas III arrived at an apartment on East Cheyenne Avenue in North Las Vegas to participate in a deal to purchase 20 pounds of marijuana from the deceased victim, Luciano Madrigal-Herrera. Also present at the apartment were Julio Nunez and Angel Juarez. The victim showed some of the marijuana to Matthews for inspection, and then went back outside to retrieve the rest. Matthews also left the apartment, stating he was going to get his friend, Thomas, as well as money for the marijuana. The three men returned to the apartment, and then Thomas and Matthews each produced handguns and repeatedly shot the victim during an attempt to rob him of the marijuana, causing his death. The defendants took the marijuana and attempted to flee with it. Nunez, in an attempt to prevent Matthews and Thomas from fleeing with the marijuana, shot at both of them with a sawed-off shotgun, striking both Thomas and his vehicle. Thomas and Matthews were ultimately able to escape the scene. Thomas was apprehended later the same night by the North Las Vegas Police Department after officers discovered that his gunshot-riddled vehicle had been left behind at the scene parked in front of the apartment where Madrigal-Herrera had been killed. Matthews was charged after the ensuing investigation led to his identity as the second suspect.
Three co-defendants were also charged in the scheme. John Thomas III, 25, of Las Vegas, pleaded guilty to conspiracy to possess marijuana with intent to distribute and using a firearm during and in relation to a drug trafficking crime resulting in death, and is awaiting sentencing. Julio Nunez, 28, of Las Vegas, pleaded guilty to one count of conspiracy to possess marijuana with intent to distribute and one count of discharging a firearm during and in relation to a drug trafficking crime and was sentenced to 42 months in prison and five years of supervised release. Angel Juarez, 29, of North Las Vegas, is awaiting trial.
This case was investigated by ATF, the Las Vegas Metropolitan Police Department, and North Las Vegas Police Department. The case was prosecuted by Assistant U.S. Attorneys Phillip N. Smith Jr. and Alexandra M. Michael.
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Kansas Man Indicted on Child Pornography and Sex Tourism ChargesRead the Press Release
A 70-year-old Kansas native who was residing in Panama was indicted today and charged with multiple crimes involving sexual conduct with minors in a foreign country, announced Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Jebediah Dishman, 70, of Fredonia, Kansas, was arrested in Houston on Nov. 8, 2016, and originally charged by criminal complaint. He later appeared before U.S. Magistrate Judge Mary Milloy who found him to be a flight risk and ordered him into custody. Today, a grand jury in the U.S. District Court for the Southern District of Texas indicted him on one count each of engaging in illicit sexual conduct with a minor in a foreign country, production of child pornography, sex trafficking of children, and obtaining custody and control of a minor for the purpose of producing sexually explicit visual depictions of the minor.
According to the indictment, from September 2014 through March 2015, Dishman traveled from the United States to the Republic of Indonesia and engaged in illicit sexual conduct with minors. While in Indonesia in February 2015, Dishman allegedly used a minor to produce visual depictions of the minor engaging in sexually explicit conduct. In addition, the indictment alleges that between September 2014 and March 2015, Dishman attempted to recruit and entice minors in the Republic of Indonesia and other countries outside of the territorial jurisdiction of the United States to engage in commercial sex acts.
The charges contained in the indictment are only allegations. The defendant is presumed innocent unless and until he is proven guilty beyond a reasonable doubt in a court of law.
The FBI is investigating this case with the cooperation of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Trial Attorney Elly M. Peirson of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Sherri Zack of the Southern District of Texas are prosecuting the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Kansas Man Indicted on Child Pornography and Sex Tourism ChargesRead the Press Release
HOUSTON – A 70-year-old Kansas native who was residing in Panama was indicted today and charged with multiple crimes involving sexual conduct with minors in a foreign country, announced U.S. Attorney Kenneth Magidson and Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division.
Jebediah Dishman, of Fredonia, Kansas, was arrested in Houston on Nov. 8, 2016, and originally charged by criminal complaint. He later appeared before U.S. Magistrate Judge Mary Milloy who found him to be a flight risk and ordered him into custody. Today, a grand jury in the U.S. District Court for the Southern District of Texas indicted him on one count each of engaging in illicit sexual conduct with a minor in a foreign country, production of child pornography, sex trafficking of children and obtaining custody and control of a minor for the purpose of producing sexually explicit visual depictions of the minor.
According to the indictment, from September 2014 through March 2015, Dishman traveled from the United States to the Republic of Indonesia and engaged in illicit sexual conduct with minors. While in Indonesia in February 2015, Dishman allegedly used a minor to produce visual depictions of the minor engaging in sexually explicit conduct. In addition, the indictment alleges that between September 2014 and March 2015, Dishman attempted to recruit and entice minors in the Republic of Indonesia and other countries outside of the territorial jurisdiction of the United States to engage in commercial sex acts.
The FBI is investigating this case with the cooperation of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Assistant U.S. Attorney Sherri Zack of the Southern District of Texas and Trial Attorney Elly M. Peirson of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) are prosecuting the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.
Justice Department Sues to Stop South Florida Tax Return Business and its Preparers from Preparing Tax ReturnsRead the Press Release
A Lauderhill, Florida tax return preparation business, and several of its corporate officers, prepare false tax returns for their customers, according to a new civil lawsuit filed by the Justice Department today. The suit, filed in federal court in Fort Lauderdale, Florida, asks the court to bar Aleluya Universal Accounting Services Inc. (Aleluya) and its officers Frantz Petit-Dos, Luczor Fertilien, and David Joseph from preparing federal income tax returns for others. The government also requests a court order requiring the business and these officers to disgorge the gross receipts they obtained from preparing federal tax returns that make, among other things, false claims.
The complaint alleges that the defendants prepare tax returns that unlawfully understate income tax liabilities and overstate refunds by fabricating and/or exaggerating deductions and tax credits their clients are not eligible to take. For example, the defendants claimed Fuel Tax Credits for customers who did not qualify for this credit, according to the complaint. In particular, Joseph falsely advised one customer that she was eligible for the Fuel Tax Credit because she was self-employed and drove herself to work, according to the complaint. Similarly, Fertilien told the Internal Revenue Service (IRS) that he advised anyone with receipts for gas used in their vehicles could claim the Fuel Tax Credit, according to the complaint.
The government alleges in its complaint that Petit-Dos’s, Fertilien’s, and Joseph’s misconduct predates the creation of Aleluya. Prior to Joseph forming Aleluya in June 2013, Petit-Dos and Fertilien owned a tax return preparation business called Imperial Taxation that was located at the same Lauderhill location as Aleluya, according to the complaint. The complaint alleges that Petit-Dos, Fertilien, and Joseph (a return preparer at Imperial Taxation) prepared false tax returns and committed other violations of the Internal Revenue Code while at Imperial Taxation. Altogether, the complaint alleges that the loss to the U. S. Treasury from the defendants’ activities may be in the millions of dollars.
The IRS is reminding taxpayers that the 2017 individual income tax return filing season began on Jan. 23, 2017, and there is information available on the IRS’s website. Return preparer fraud was one of the IRS’s Dirty Dozen Tax Scams for 2016 and taxpayers seeking a return preparer should remain vigilant. The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers.
In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Jefferson County man and Pennsylvania woman convicted for heroin distribution, money launderingRead the Press Release
MARTINSBURG, WEST VIRGINIA – Mark Hanshaw, 27, of Harpers Ferry, West Virginia, and Tiara Adams, 31, of Red Lion, Pennsylvania, were convicted for their roles in a heroin distribution operation, Acting United States Attorney Betsy Steinfeld Jividen, announced.
Hanshaw pled guilty to one count of “Conspiracy to Distribute Heroin.” He faces up to twenty years in prison and a fine of up to $1,000,000. Adams pled guilty to one count of “Conspiracy to Launder Monetary Instruments.” She faces up to twenty years in prison and a fine of up to $500,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Anna Z. Krasinski prosecuted the case on behalf of the government. The Federal Bureau of Investigation and the Eastern Panhandle Drug and Violent Crime Task Force investigated.
U.S. Magistrate Judge Robert W. Trumble presided.
Jackson State University Agrees to Pay $1.17 Million to Settle False Claims Act AllegationsRead the Press Release
Jackson, Miss - Jackson State University (JSU) has agreed to pay the United States $1.17 million to settle allegations that JSU mismanaged National Science Foundation (NSF) Grants, announced U.S. Attorney Gregory K. Davis and Allison Lerner, Inspector General at the National Science Foundation.
During the time period, June 1, 2006 to September 30, 2011, JSU submitted claims and/or expended funds under NSF Grants and in so doing, impliedly certified that every claim and/or expenditure was supportable, allocable, and allowable and that JSU would maintain adequate records to support these claims and expenditures. In 2012, an audit of the NSF Grants performed under contract for the NSF Office of Inspector General ("NSF-OIG") identified salary and non-salary expenditures that were unallowable, not allocable, and/or had insufficient, inadequate and/or no supporting documentation. A subsequent NSF-OIG investigation determined that, in preparation for the audit, and subsequently in response to the preliminary audit findings, JSU employees fabricated time and effort reports and provided them to the auditors, and in some instances presented inadequate and/or no supporting documentation.
As part of the settlement, JSU has also agreed to take specific steps to prevent these events from reoccurring by instituting a compliance program, which includes a comprehensive training program on time and effort reporting and other aspects of federal grants management, for a five-year period beginning in February.
"Recipients of federally-funded grants must adhere to the regulations applicable to those grants and accurately report the required information. This settlement sends a strong signal to grant recipients that failure to follow the applicable requirements may lead to significant financial consequences," stated Gregory K. Davis, United States Attorney for the Southern District of Mississippi.
Allison Lerner, Inspector General at the National Science Foundation said, "Each year the National Science Foundation awards millions of dollars in grants to institutions to promote promising scientific research. Fabricating information to improperly obtain and spend scarce research dollars will not be tolerated. I commend the U.S. Attorney’s Office for its effort in this settlement, which will require the return of $1.17 million."
This case was the result of an investigation by NSF-OIG. Assistant United States Attorney Kristi H. Johnson and ACE Auditor Kim Mitchell handled the matter for the United States.
The claims settled by this agreement are allegations only, and there has been no determination of liability.
Iowa Nursing Facility, Its Ownership, and Its Management Agree to Pay $100,000 to Resolve Allegations that Residents Received Worthless CareRead the Press Release
The Abbey of Le Mars, Inc., and other individuals with financial interests in the Abbey’s operations, agreed to pay $100,000 to settle allegations they violated the False Claims Act by submitting or causing claims to be submitted to Medicaid when the care provided to nursing facility residents was so grossly substandard that the care was worthless and effectively without value.
The allegations relate to care provided for sixteen residents between January 2009 and February 2015. The government alleged that the care the Abbey provided was grossly substandard in multiple material ways:
- providers failed to address skin conditions and fractures, leading to inadequate care and additional medical costs;
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residents were subjected in the first instance to physical restraints and unnecessary medications rather than other types of interventions;
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providers utilized anti-psychotic medications to numb or sedate residents so as to decrease residents’ needs; and
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residents were not given adequate nourishment or bathing and toileting care, leading to infections and impactions necessitating emergency room visits.
The individuals signing the agreement include Leo Lenaghan, who owns the building where the Abbey operates; John Florina, Jr., who was a paid consultant to the Abbey; Janet Howe, the Abbey’s president; Don Butcher, who worked as the Abbey’s administrator; and the Abbey’s former director of nursing, Donna Stuhrenberg.
The False Claims Act settlement agreement only resolves government claims related to the alleged submission of claims for payment to Medicaid when the services provided were worthless and effectively without value. Other government claims are not released.
“Nursing facility residents deserve to be treated with dignity, respect, and attentive care sufficient to meet their medical needs and support their mental health,” said United States Attorney Kevin W. Techau. “This settlement demonstrates the commitment of the Northern District of Iowa United States Attorney’s Office to defending the integrity of the system and ensuring that taxpayer money is spent as Congress intended. We will continue to work with our federal and state partners to hold nursing facility owners, administrators, and employees across the district accountable if they are responsible for nursing facility residents being mistreated or if Medicaid or Medicare payments are wasted or misspent.”
The investigation and settlement are part of the Department of Justice’s Elder Abuse Initiative. In March 2016, the United States Attorney’s Office for the Northern District of Iowa was selected as one of ten districts nationwide to launch regional Elder Justice Task Forces. The Elder Justice Task Forces reflect the department’s larger strategy and commitment to protecting our nation’s seniors, spearheaded by the department’s Elder Justice Initiative. The Elder Justice Initiative coordinates and supports the Department’s law enforcement efforts and policy activities on elder justice issues. It plays an integral role in the department’s investigative and enforcement efforts against nursing homes and other long-term care entities that deliver grossly substandard care to Medicare and Medicaid beneficiaries. The United States Attorney’s Office for the Northern District of Iowa has rededicated its efforts and resources to investigate and hold accountable those who have been involved in activities incompatible with ensuring that the state’s more vulnerable citizens are treated with dignity and respect.
The investigation was led by the State of Iowa Medicaid Fraud Control Unit and conducted in conjunction with the Health and Human Services Office of Inspector General. The claims settled by this agreement are allegations only and there has been no determination of liability.
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Indictment: Man Used Stolen Identities to Apply for Car LoansRead the Press Release
WICHITA, KAN. – A Wichita man was indicted Tuesday on federal charges of using stolen identities to applying for car loans, U.S. Attorney Tom Beall said.
Reu Charles Chamberlain, 30, Wichita, Kan., is charged with three counts of wire fraud and three counts of aggravated identity theft. The indictment alleges he used identification bearing his picture along with information from stolen identities to apply for the following car loans:
-- $48,902 for a 2016 Dodge challenger at Eddy’s Chrysler Jeep Dodge.
-- $44,746 for a 2015 Dodge Challenger at Midway Motors.
-- $30,740 for a 2013 Cadillac CTS at Super Car Guys.
If convicted, he faces up to 20 years in federal prison and a fine up to $250,000 on each wire fraud count, and a mandatory two years (consecutive) on each of the other counts. The U.S. Postal Inspection Service investigated. Assistant U.S. Attorney Alan Metzger is prosecuting.
OTHER GRAND JURY INDICTMENTS
Heraclio Estrella-Montero, 30, who is unlawfully in in the United States; Yoan Alejandro Castillo-Zamora, 30, who is unlawfully in the United States; Fernando Chavez-Rodriguez, 40, who is unlawfully in the United States; Michael Cura, 43, Edinburg, Texas; and Richard Slauenwhite, 33, Rio Grande, Texas, are charged with one count of conspiracy to distribute methamphetamine and one count of possession with intent to distribute methamphetamine. The crimes are alleged to have occurred Jan. 9 to Jan. 13, 2017, in Shawnee County, Kan.
If convicted, they face a penalty of not less than 10 years in federal prison and a fine up to $10 million. The Drug Enforcement Administration investigated. Assistant U.S. Attorney Greg Hough is prosecuting.
George S. James, 48, Brookhaven, Ga., is charged with one count of wire fraud and one count of aggravated identity theft.
James first appeared in court Jan. 24 on a criminal complaint charging him with wire fraud. The indictment adds an aggravated identity theft count. James is accused of carrying out an e-mail spoofing scheme that cost Sedgwick County $566,000. He is alleged to have stolen the identity of a Cornejo and Sons executive so he could divert a payment the county meant to send to the company.
If convicted, he faces up to 20 years in federal prison and a fine up to $250,000 on the wire fraud count and a mandatory two years (consecutive) on the identity theft charge. The FBI, the Sedgwick County Sheriff’s Office and the Wichita Police Department investigated. Assistant U.S. Attorney Alan Metzger is prosecuting.
Greggory K. O’Neal, 33, Derby, Kan., Sarah Beth Myers, 20, El Dorado, Kan., and Ashley N. Moore, 30, Wichita, Kan., are charged with drug trafficking. O’Neal is charged with four counts of possession with intent to distribute methamphetamine (counts 1, 3, 5 and 6), two counts of possession with intent to distribute marijuana (counts 2 and 4) and one count of distributing methamphetamine (count 7). Meyers and Moore are charged with one count each of possession with intent to distribute methamphetamine (counts 3 and 6 respectively). The crimes are alleged to have occurred in 2015 and 2016 in Sedgwick County, Kan.
Upon conviction, the crimes carry the following penalties:
Counts 1, 6 and 7: Not less than 10 years in federal prison and a fine up to $10 million.
Counts 2 and 4: Up to five years and a fine up to $250,000.
Counts 3 and 5: Not less than five and not more than 40 years and a fine up to $5 million.
The Drug Enforcement Administration, the Wichita Police Department and the Sedgwick County Sheriff’s Office investigated. Assistant U.S. Attorney Lanny Welch is prosecuting.
Samuel Garcia-Ayala, 34, a citizen of Mexico, is charged with one count of unlawful possession of a firearm by a person unlawfully in the United States, one count of unlawful possession of a false document, and one count of aggravated identity theft. He was found Jan. 3, 2017, in Ford County, Kan.
If convicted, he faces up to 10 years in federal prison and a fine up to $250,000 on the firearm charge and the document charge, and a mandatory two years (consecutive) on the identity theft charge. Immigration and Customs Enforcement’s Enforcement Removal Operations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.
Juan Manuel Araujo-Gutierrez, 31, a citizen of Mexico, is charged with one count of unlawfully re-entering the United states after being deported. He was found Jan. 5, 2017, in Reno county, Kan.
If convicted, he faces up to two years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement’s Enforcement Removal Operations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.
Irineo Martinez-Merino, 36, a citizen of Mexico, is charged with one count of unlawful possession of a firearm by a person unlawfully in the United States. The crime is alleged to have occurred May 5, 2016, in Marion County, Kan.
If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement’s Enforcement Removal Operations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.
Genaro Herrera-Hernandez, 32, a citizen of Mexico, is charged with one count of unlawfully re-entering the United states after being convicted of a crime and deported. He was found Dec. 22, 2016, in Sedgwick County, Kan.
If convicted, he faces up to 20 years in federal prison and a fine up to $250,000. Homeland Security Investigations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.
Wade A. Dunn, 28, Wichita, Kan., is charged with one count of unlawful possession of a firearm following a felony conviction. The crime is alleged to have occurred Oct. 5, 2016, in Sedgwick County, Kan.
If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney David Lind is prosecuting.
Kip Allen Koch, 44, Chanute, Kan., is charged with four counts of distributing methamphetamine The crimes are alleged to have occurred in July and August 2016 in Neosho County, Kan.
If convicted, he faces a penalty of not less than 10 years on two of the counts and not less than five years on the other two counts. He also faces a fine up to $10 million on two of the counts and up to $5 million on the other two counts. The Kansas Bureau of Investigation investigated. Special Assistant U.S. Attorney Kimberly Rodebaugh is prosecuting.
Miguel Lizarraga Sauceda, 21, Federal Way, Wash., is charged with one count of possession with one count of possession with intent to distribute methamphetamine. The crime is alleged to have occurred Dec. 27, 2016, in Seward County, Kan.
If convicted, he faces not less than 10 years in federal prison and a fine up to $10 million. The Drug Enforcement Administration investigated. Special Assistant U.S. Attorney Kimberly Rodebaugh is prosecuting.
Osvaldo Aguilar, 25, a resident of Mexico, is charged with possession with intent to distribute approximately 19.7 kilograms of cocaine. The crime is alleged to have occurred Dec. 30, 2016, in Clark County, Kan.
If convicted, he faces not less than 10 years in federal prison and a fine up to $10 million. The Drug Enforcement Administration investigated. Special Assistant U.S. Attorney Kimberly Rodebaugh is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Honduran National Sentenced to 3 Years Imprisonment for Illegal Re-EntryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JUAN HUMBERTO HERNANDEZ-YONES, age 33, a citizen of Honduras, was sentenced today after previously pleading guilty to a one count Indictment charging him with illegal re-entry of a removed alien.
U.S. District Judge Kurt D. Engelhardt sentenced HERNANDEZ-YONES to 36 months’ imprisonment. Following completion of his sentence, HERNANDEZ-YONES will be surrendered to the custody of the U.S. Immigration and Customs Enforcement for removal proceedings.
According to the court documents, on June 30, 2016, HERNANDEZ-YONES was found in the United States after having been deported on July 15, 2011. HERNANDEZ-YONES had two prior felony convictions for illegal re-entry, including one from the Eastern District of Louisiana in 2008.
U.S. Attorney Polite praised the work of the United States Immigration and Customs Enforcement in investigating this matter. Assistant United States Attorney Emily K. Greenfield was in charge of the prosecution.
Honduran National Sentenced for Illegal Re-EntryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that ALEX OBDULIO CRUZ-MATUTE, age 39, was sentenced today after previously pleading guilty to a one-count Indictment for illegal reentry of a removed alien in violation of Title 8, United States Code, Section 1326(a).
U.S. District Judge Kurt D. Engelhardt sentenced CRUZ-MATUTE to two years imprisonment, to be followed by two years of supervised release. Additionally, CRUZ-MATUTE was fined $5,000 and ordered to pay $100 special assessment. Following completion of his sentence, CRUZ-MATUTE will be surrendered to the custody of the Immigration and Customs Enforcement for removal proceedings.
According to court documents, CRUZ-MATUTE reentered the United States after having been deported on October 11, 2007.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security in investigating this matter. Assistant U.S. Attorney Spiro G. Latsis was in charge of the prosecution.
Gretna Man Pleads Guilty to Distribution of Child PornographyRead the Press Release
U.S. Attorney Kenneth A. Polite announced that GIORGIO COSENZA, age 29, of Gretna, pled guilty today to a one-count Bill of Information charging him with distribution of images and videos depicting the sexual exploitation of children.
According to court documents, on April 14, 2016, law enforcement officials executed a search warrant at COSENZA’s residence. Agents obtained the search warrant after observing a posting he authored on a New Orleans-based online classified advertisement website and engaging him in email correspondence. During the email correspondence, COSENZA told a special agent of the FBI, acting in an undercover capacity, that he collected images and videos of children being sexually exploited.
During the execution of the search warrant, special agents with the FBI seized numerous electronic items including one laptop computer and one smartphone that contained images and videos of child pornography. A forensic examination of the device revealed that COSENZA used the devices to search for, download, and save images and videos of children as young as approximately three years old engaging being sexually victimized. The forensic examination located approximately 740 images and 30 videos of prepubescent children engaging in sexually explicit conduct. The contents of his devices also revealed that COSENZA had taken, saved, and subsequently distributed, sexually images of an approximately fourteen-year-old female with whom he stated he had engaged in sexual intercourse years earlier. Further, COSENZA engaged in text-based correspondence in 2014 and 2015 in which he distributed numerous sexually explicit images of children and, further, expressed an interest in engaging in sexual activity with minors between the ages of six and fourteen years old.
Based on the information contained within COSENZA’S smartphone, agents obtained a search warrant for the contents of his email account. The results of the search warrant revealed the COSENZA had received and distributed additional images depicting the sexual victimization of children.
COSENZA faces a mandatory minimum of five years imprisonment and a maximum term of imprisonment of twenty years, followed by 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 Kurt D. Engelhardt set sentencing for April 6, 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 Federal Bureau of Investigation. Assistant U.S. Attorney Jordan Ginsberg is in charge of the prosecution.
Grape Street Crips Crack-Cocaine Wholesalers Plead Guilty to Racketeering, Drug Trafficking ChargesRead the Press Release
NEWARK, N.J. – Two crack-cocaine wholesalers for the New Jersey set of the Grape Street Crips gang today admitted their involvement in racketeering and drug trafficking conspiracies operating in Newark, New Jersey, U.S. Attorney Paul J. Fishman announced today.
Hakeem Vanderhall, a/k/a “Keem,” a/k/a “Sugar Bear,” 32, of East Orange, New Jersey, and Eric Concepcion, a/k/a “Eddie Arroyo,” a/k/a “E-Wax,” a/k/a “Wax,” 30, of Clifton, New Jersey, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to Count 1 and Count 18 of a sixth superseding indictment charging them with racketeering conspiracy and conspiracy to distribute crack-cocaine.
According to documents filed in this case and statements made in court:
The New Jersey Grape Street Crips controlled drug trafficking and other criminal activities in various areas of Newark. Vanderhall, Concepcion and other members of the gang, including Jamar Hamilton, a/k/a “Gunner,” Tyquan Clark a/k/a “Tah,” and Rashan Washington, a/k/a “Shoota,” used and shared a dedicated cell phone to accept orders for, and distribute, thousands of clips of crack-cocaine to other distributors of crack-cocaine, including other gang members.
To protect their gang and drug territory, the New Jersey Grape Street Crips operating in the area of 6th Avenue and North 5th Street in Newark used “community guns” that were easily accessible to gang members. During the course of the investigation, law enforcement agents seized numerous firearms, including a .410 caliber assault rifle, a.45 caliber Thompson semi-automatic carbine, a 7.62 caliber assault rifle, and numerous semi-automatic handguns.
Under the terms of today’s plea agreements, both Vanderhall and Concepcion will be sentenced to 18 years in prison and five years of supervised release. Sentencing for both defendants is scheduled for May 16, 2017.
U.S. Attorney Fishman credited special agents of the DEA, under the direction of Special Agent in Charge Carl J. Kotowski in Newark, and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, for the investigation leading to the charges. He also thanked prosecutors and detectives of the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray; police officers and detectives of the Newark Department of Public Safety, under the direction of Director Anthony F. Ambrose; and the Essex County Sheriff’s Office under the direction of Armando B. Fontoura, for their assistance in this case.
The government is represented by Assistant U.S. Attorneys Osmar J. Benvenuto and Barry A. Kamar of the Criminal Division in Newark.
This case was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF) and the FBI’s Safe Streets Task Force, a partnership between federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations and those primarily responsible for the nation’s illegal drug supply.
Defense counsel:
Vanderhall: Joshua L. Markowitz Esq., Lawrenceville, New Jersey
Concepcion: Stephen Turano Esq., Newark