Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
Wednesday 9 November 2016
New York Man Sentenced on Cocaine ChargeRead the Press Release
ROANOKE, VIRGINIA – A Brooklyn man, who previously pled guilty to a federal cocaine charge, was sentenced today in the United States District Court for the Western District of Virginia, announced United States Attorney John P. Fishwick Jr.
James Christopher Davis, 47, of Brooklyn, New York, previously pled guilty to one possessing with the intent to distribute cocaine. Today in District Court, Davis was sentenced to 27 months in federal prison.
“The distribution of illegal drugs continues to a problem in our communities that must be addressed through a combined approach of enforcement, treatment and prevention,” United States Attorney Fishwick said today.
According to evidence presented at previous hearings by Assistant United States Attorney Andrew Bassford, police conducted a search warrant at an apartment in Roanoke on January 27, 2016. When Police entered the home, the first person the observed was Davis, who ran to the bathroom and slammed the door. Police entered the bathroom, arrested Davis and recovered a large, black plastic back containing a substance later determined to be cocaine.
Assistant United States Attorney Andrew Bassford prosecuted the case for the United States.
New York Man Admits Distribution Conspiracy Involving More Than 10 Kilograms of Synthetic Designer DrugsRead the Press Release
NEWARK, N.J. – A Queens, New York, man today admitted his role in a scheme to distribute controlled substance analogues, which are designer drugs that have chemical structures and hallucinogenic effects similar to Schedule I controlled substances, U.S. Attorney Paul J. Fishman announced.
Elmostafa Charif, 37, pleaded guilty before U.S. District Judge Kevin McNulty to a two-count indictment charging him with conspiracy to distribute, and possessing with intent to distribute, the controlled substance analogues NM2201 and 5F-AMB. NM2201 and 5F-AMB are most closely related to synthetic Tetrahydrocannabinol, or THC.
According to documents filed in this case and statements made in court:
Since February 2011, the Drug Enforcement Administration (DEA) has been investigating the importation, distribution, and use of designer drugs popularly known as synthetic cannabinoids. “K2” and “Spice” are common examples of synthetic cannabinoids.
Synthetic cannaboids are created when damiana leaves – an inert, plant-like substance – are sprayed with controlled substance analogues and treated with synthetic flavoring. The flavored and treated damiana leaves are then smoked by users.
Charif admitted that, on April 13, 2015, he conspired with others to purchase and distribute approximately 10 kilograms of synthetic cannabinoids, including approximately five kilograms of NM2201 and approximately five kilograms of 5F-AMB. Charif also admitted that he purchased liquid flavoring and damiana leaves with the controlled substance analogues, knowing that they would be used to create a product that was smoked or otherwise consumed by users.
NM2201 and 5F-AMB are each controlled substance analogues as defined under the Analogue Act due to the fact that both NM2201 and 5F-AMB have chemical structures and hallucinogenic properties similar to the Schedule I controlled substances 5F-PB-22 and ADB-PINACA, respectively.
Both counts of the indictment to which Charif pleaded guilty carry a maximum potential penalty of 20 years in prison and a $1 million fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for Feb. 22, 2017.
U.S. Attorney Fishman credited special agents of the DEA, under the direction of Special Agent in Charge Carl J. Kotowski, with the investigation leading to today’s plea.
The government is represented by Assistant U.S. Attorney Melissa Wangenheim of the Organized Crime Drug Enforcement Task Force Unit in Newark.
Defense counsel: Aaron Wallenstein, Esq.
Navajo Man Sentenced to Prison for Federal Involuntary Manslaughter ConvictionRead the Press Release
ALBUQUERQUE – Rob Begay, 24, an enrolled member of the Navajo Nation who resides in Twin Lakes, N.M., was sentenced yesterday in federal court in Albuquerque, N.M., to 30 months in prison followed by three years of supervised release for his involuntary manslaughter conviction.
Begay was arrested on Dec. 2, 2015, on a criminal complaint charging him with involuntary manslaughter. Begay was indicted on Dec. 17, 2015, and was charged with killing a Navajo woman on Nov. 28, 2015, while driving under the influence of alcohol. According to the indictment, Begay committed the crime on the Navajo Indian Reservation in McKinley County, N.M.
On July 26, 2016, Begay pled guilty to the indictment and admitted killing the victim by driving recklessly while under the influence of alcohol. Begay admitted that because of his intoxication he was incapable of exercising clear judgment and a steady hand in operating a vehicle.
This case was investigated by the Crownpoint office of the Navajo Nation Division of Public Safety, and was prosecuted by Assistant U.S. Attorney Jack Burkhead.
Mount Pleasant Man Sentenced to Prison for Enticement of a MinorRead the Press Release
DAVENPORT, IA – On November 9, 2016, Kevin Dwane Carpenter, 51, of Mount Pleasant, Iowa, was sentenced by Chief United States District Court Judge John A. Jarvey to 240 months in prison for enticement of a minor, announced United States Attorney Kevin E. VanderSchel. Carpenter was ordered to serve fifteen years of supervised release following his prison term and to pay $100 towards the Crime Victims’ Fund.
Carpenter pleaded guilty to enticement of a minor on May 10, 2016. According to the plea agreement, in July 2014, an agent with the Iowa Division of Criminal Investigations responded to a Craigslist advertisement posted by Carpenter entitled, "Looking for young boy." The agent responded to the advertisement purporting to be a 15-year-old male and Carpenter initiated conversations about performing sexual acts. On August 28, 2014, Carpenter arranged to meet the "child" at a location in Mount Pleasant. At the meet location, agents confronted Carpenter and he admitted he was there to meet a 15-year-old boy with plans to go back to his residence to engage in sexual acts. A forensic examination of Carpenter’s electronic devices showed Carpenter had been communicating with other minors.
This matter was investigated by the Burlington Police Department and the Iowa Division of Criminal Investigations. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa as part of the Project Safe Childhood initiative.
Montgomery Man Sentenced to Prison for Participation in Stolen Identity Refund Fraud SchemeRead the Press Release
Montgomery, Alabama – A Montgomery, Alabama resident was sentenced to 28 months in prison today for his role in a stolen identity refund fraud scheme, announced U.S. Attorney George L. Beck Jr. of the Middle District of Alabama, and Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division.
Lambert Derran Smothers aka Main or Mane, 25, admitted that he participated in a conspiracy which used stolen personal identifying information including names, dates of birth and social security numbers to file more than 100 fraudulent income tax returns relating to tax years 2010, 2011 and 2012. On the returns, Smothers and his co-conspirators fraudulently claimed at least $157,292 in income tax refunds.
“Stolen identity refund crimes cause untold damage and hardship to the individual victims and drain the U.S. Treasury,” said Principal Deputy Assistant Attorney General Ciraolo. “Individuals who engage in this criminal conduct will be prosecuted, and will face prison terms and monetary penalties.”
“Protecting tax payer dollars is a priority for my office,” said U.S. Attorney Beck. “Identity theft and tax fraud affects too many people in our communities and we must use all available resources under the law to destroy it. I want to thank IRS Criminal Investigations and the U.S. Secret Service for identifying and shutting down this criminal scheme.”
“Stealing from the government is not a way to earn a living,” said Special Agent in Charge Veronica Hyman-Pillot for the Internal Revenue Service-Criminal Investigation (IRS-CI). “Lambert Smothers and his associates victimized many taxpayers in their attempt to make quick money. Today’s sentencing should emphasize the message that IRS-CI will continue to put forth every effort to identify, investigate, and recommend prosecution on individuals who commit refund fraud.”
Smothers pleaded guilty in July to conspiring to defraud the United States, theft of government money and aggravated identity theft. In addition to the term of prison imposed, Smothers was also ordered to serve three years of supervised release and to pay $81,792.41 in restitution to the IRS.
U.S. Attorney Beck and Principal Deputy Assistant Attorney General Ciraolo commended special agents of IRS-CI and the U.S. Secret Service, who conducted the investigation, and Trial Attorneys Gregory P. Bailey and Robert J. Boudreau of the Tax Division and Assistant U.S. Attorney Jonathan Ross of the Middle District of Alabama, who prosecuted this case.
Monroe County Man Pleads Guilty to Heroin and Sex Trafficking Charges; Co-Defendant Admits to Drug TraffickingRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that a Monroe County man pleaded guilty today before U.S. District Court Judge Malachy E. Mannion in Scranton, to participating in a heroin trafficking conspiracy that stretched from Stroudsburg to New York to the state of Maine, and to a forcing or coercing women into engaging in prostitution in northeastern Pennsylvania.
According to United States Attorney Bruce D. Brandler, the defendant, Jose Velazquez, age 26, who used the street name “Sev,” admitted to conspiring with others to distribute more than 100 grams of heroin (which is approximately equivalent to 4,000 retail bags of heroin) and to sex trafficking an adult female between 2012 and 2014.
Velazquez was indicted along with six other people by a federal grand jury in Scranton in September 2015, as a result of an investigation by the Federal Bureau of Investigation, the Pennsylvania State Police, Maine State Police, the Monroe County District Attorney’s Office, and local police in Monroe County. In October 2016, Velazquez was charged in a superseding indictment with drug trafficking and sex trafficking crimes.
The superseding indictment alleges that Velazquez participated in a street gang known as the Black P-Stones; that male gang members were “beaten-in” to the gang and female members were “sexed-in” to the gang. The superseding indictment further alleged that members of the Black P-Stones obtained heroin in New York and distributed the heroin in Stroudsburg and locations in the state of Maine. According to the superseding indictment, couriers were used to transport heroin from New York to Maine.
The superseding indictment alleges that females were “sexed-in” to the gang by being forced to engage in sex with male gang members; recruited and coerced to engage in prostitution; advertised as adult escorts on a website; provided with heroin and other drugs; and placed in various area hotels/motels to work as prostitutes. It is alleged that the sex trafficking defendants used threats, force, and intimidation to coerce females to engage in prostitution.
In today’s proceeding, Velazquez pleaded guilty to conspiracy to distribute in excess of 100 grams of heroin, and one count of sex trafficking by force or coercion. He faces a mandatory minimum five-year prison sentence and a potential 40-year prison sentence for the drug conspiracy charge; and a mandatory minimum 15-year prison sentence and a potential life sentence for the sex trafficking charge
One of Velazquez’s co-defendants, Sean Griffin, age 22, who used the street name “Kritical,” also pleaded guilty today before Judge Mannion to participating in the same drug trafficking conspiracy. He admitted to being a sub-distributor of between 100 grams and 400 grams of heroin for the Black P-Stones. He faces a potential maximum sentence of 20 years in prison.
Judge Mannion ordered pre-sentence investigations to be completed. Sentencing for both defendants will be scheduled at a later date.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
This case was also brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Assistant U.S. Attorney Francis P. Sempa is prosecuting the case.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for these offenses is life imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
# # #
Missouri Man Sentenced for Child ExploitationRead the Press Release
SHERMAN, Texas — A 30-year-old Missouri man has been sentenced to federal prison for child exploitation in the Eastern District of Texas, announced Acting U.S. Attorney Brit Featherston today.
Nathan Oliva pleaded guilty on January 28, 2016, to sex trafficking of children and was sentenced to 365 months in federal prison today by U.S. District Judge Amos Mazzant.
According to information presented in court, an unidentified person called in a tip to the Denton Police Department that a child was being trafficked by Oliva and was at a hotel in Denton, Texas. Denton Police officers located a classified ad on Backpage.com that offered the child for sexual activity. Officers went to the hotel, where they located the victim and the defendant. The victim, who had injuries sustained from an assault by Oliva, told the officers that she was in fear for her life because Oliva had injured her and had threatened her with greater harm. Moreover, Oliva had taken control of her cell phone, driver’s license, and social security card. Oliva had also threated to harm the parents of the victim. As part of his plea, Oliva admitted to posting ads on Backpage.com that offered the victim, who was younger than 18-years-old, for commercial sex. Oliva was indicted by a federal grand jury on August 13, 2015.
This case was prosecuted as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Homeland Security Investigations and the Denton Police Department and prosecuted by Assistant U.S. Marisa J. Miller.
Milwaukee Man Sentenced to More Than 21 Years in Federal Prison for Transporting a Minor to Illinois to Engage in ProstitutionRead the Press Release
CHICAGO — A Milwaukee man was sentenced today to more than 21 years in federal prison for transporting an underage girl to the Chicago area from Wisconsin to engage in prostitution.
DAJUAN KEY, 31, brought the girl to the Chicago area from Madison, Wisc., in September 2013. At the time, the victim was 15 years old. Once in the Chicago area, Key forced the girl to engage in commercial sex acts, with Key keeping all of the money.
A jury in February convicted Key on one count of knowingly transporting a minor from Wisconsin to Illinois to engage in prostitution. U.S. District Judge Virginia M. Kendall imposed the 262-month sentence in federal court in Chicago.
“All of the defendant’s reprehensible conduct in this case evidences a person driven by greed, willing to engage in manipulation, deception, and psychological abuse, solely for his own personal profit,” Assistant U.S. Attorney Katherine Sawyer argued in the government’s sentencing memorandum.
Evidence at Key’s trial revealed that Key encountered a minor online and travelled to Madison to pick her up and bring her to southwest suburban Romeoville. Key took photographs of the girl, provided her with lingerie to wear, and posted advertisements on the website Backpage.com. Key rented multiple hotel rooms that were used for encounters with individuals who responded to the advertisements. Key then collected all of the money earned by the minor victim.
The victim was rescued by officers of the Romeoville Police Department on Sept. 10, 2013, and Key was arrested.
The sentence was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation. The Romeoville Police Department and the Madison, Wisc., Police Department assisted in the case.
The investigation was conducted by the FBI’s Child Exploitation Task Force. The CETF is part of a nationwide effort known as the Innocence Lost National Initiative targeting the commercial sexual exploitation of children in the United States. In Chicago, the CETF is composed of FBI special agents and investigators from the Chicago Police Department, the Cook County Sheriff’s Office, and the Cook County State’s Attorney’s Office.
The government is represented by Ms. Sawyer and Assistant U.S. Attorney Christopher V. Parente.
Miami-Dade Resident Pleads Guilty to Filing False Tax Return with the Internal Revenue ServiceRead the Press Release
Miguel Rosenfeld, an agent for several of the most prominent telenovela writers throughout Latin America, pled guilty today before United States District Judge Jose E. Martinez in Miami, Florida to filing a false individual income tax return with the Internal Revenue Service (“IRS”), which substantially underreported his income for the tax year 2007.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Kelly R. Jackson, Special Agent-in-Charge, Internal Revenue Service, Criminal Investigation (“IRS-CI”), made the announcement.
Rosenfeld was charged in September 2016, by a criminal information, with one count of filing a false federal income tax return, in violation of Title 26, United States Code, Section 7206(1). According to court documents, Rosenfeld failed to report all of his income on his 2007 Form 1040, U.S. Individual Income Tax Return. Specifically, Rosenfeld reported a total income of approximately $1,032,584 on his tax return, while knowingly underreporting his income by approximately $217,974.
Rosenfeld is scheduled to be sentenced on February 27, 2017 at 1:30 p.m. before Judge Martinez. At sentencing, Rosenfeld faces up to three years in prison and a fine of up to $250,000.
Mr. Ferrer commended the investigative efforts of IRS-CI. This case is being prosecuted by Assistant U.S. Attorney Michael R. Sherwin.
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 Sentenced for Illegally ReentryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JAVIER DE JESUS PEREZ-JIMENEZ age 30, a citizen of Mexico, was sentenced today after previously pleading guilty to a one-count Bill of Information for illegal reentry of removed alien.
U.S. District Judge Jane Triche Milazzo sentenced PEREZ-JIMENEZ to time served and a $100 special assessment. PEREZ-JIMENEZ will be surrendered to the custody of the U.S. Immigration & Customs Enforcement for removal proceedings.
According to court documents, on or about August 23, 2010, JAVIER DE JESUS PEREZ-JIMENEZ was found in the United States after having been officially deported. He was ordered removed and deported on or about August 4, 2010.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security, Immigration Enforcement, in investigating this matter. Assistant United States Attorney Irene González was in charge of the prosecution.
Manhattan U.S. Attorney Announces Charges Against Film Producer and General Counsel of Investment Adviser for Multimillion-Dollar Investment SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Anthony J. Orlando, the Acting Special-Agent-in-Charge of the Los Angeles Office of the Internal Revenue Service, Criminal Investigations (“IRS-CI”), announced today that DAVID BERGSTEIN, a film producer and entrepreneur, and KEITH WELLNER, the former General Counsel, Chief Operating Officer, and Chief Compliance Officer of Weston Capital Asset Management (“Weston”), a registered investment adviser, were arrested this morning and charged with defrauding investors of more than $26 million. BERGSTEIN was arrested in Hidden Hills, California, and will be presented later today before a Magistrate Judge in Los Angeles. WELLNER was arrested this morning in Manhattan, and will be presented later today before United States Magistrate Judge Sarah Netburn in Manhattan federal court. The case is assigned to U.S. District Judge P. Kevin Castel.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, David Bergstein and Keith Wellner defrauded investors out of more than $26 million. They allegedly withheld material information, transferred funds without disclosing conflicts of interest, and misappropriated funds for their own use. For their web of alleged deception and self-dealing, Bergstein and Wellner now face federal criminal charges.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. said: “Bergstein and Wellner allegedly tricked their victims into thinking their money would be invested responsibly, but they essentially used these investments to fund their own lifestyle to the tune of several million dollars. People have the right to trade in an uncorrupted market, and today’s charges are proof of the FBI’s continued determination to root out those who unlawfully interfere with this process.”
IRS-CI Acting Special Agent in Charge Anthony J. Orlando said: “Many investors feel comfortable entrusting their hard-earned dollars with well-known movie financiers and attorneys, but this case brings to light that investors need to perform their due diligence before turning over their money to others. IRS Criminal investigation is proud to work with our federal law enforcement partners in identifying and investigating those who seek to dupe investors with false promises.”
According to the Indictment unsealed in Manhattan federal court,[1] from 2011 through 2012, the defendants engaged in a scheme to defraud by (i) concealing material information from Weston investors about financial transactions involving their money; (ii) transferring funds from one pool of Weston’s investors to make payments to, provide a security interest for, or otherwise benefit, another pool of Weston’s investors, without the required disclosures to investors concerning conflicts of interest; and (iii) misappropriating a portion of funds transferred from investor accounts for their own and others’ benefit. BERGSTEIN and WELLNER orchestrated this scheme in part through two transactions involving Weston investors’ assets: first, a loan from a Weston fund called the Partners 2 (or “P2”) Fund, and, second, a swap agreement with a Weston fund called the Wimbledon TT Portfolio (the “TT Portfolio”).
The Partners 2 Loan Scheme
In 2010, Weston agreed to a transaction with an entity named Gerova Financial Corporation (“Gerova”), an international reinsurance company, in which Weston sent assets from one of its hedge funds (the Wimbledon Financing Fund, or “WFF”) to Gerova in exchange for restricted shares of Gerova stock. This exchange was intended to replace illiquid hedge fund assets with stock, which could be bought and sold more easily. In 2011, however, Gerova’s stock price plummeted. Weston subsequently sought to unwind the transaction, and Weston’s president was introduced to BERGSTEIN for this purpose. Weston’s president, WELLNER, and BERGSTEIN subsequently formulated the outlines of a structure in which Weston would return its Gerova stock, receive its assets back from Gerova, and place those assets into another entity called Arius Libra Inc. (“Arius Libra”) as part of an investment in a separate business. Certain payments would be made along the way to facilitate the transfers.
In order to complete this transaction, BERGSTEIN, WELLNER, and others agreed to loan money from the P2 Fund, another Fund operated and managed by Weston, to Arius Libra. The purpose of this loan (the “P2 Loan”) was purportedly (i) to pay certain debts associated with Gerova, and (ii) to fund Arius Libra’s purported medical billing businesses. WELLNER arranged for the P2 Loan to be secured by certain of the assets of WFF. Thus, in the event the P2 Loan was not repaid, the P2 Fund had the ability to liquidate WFF assets to make P2 investors whole, to the detriment of investors in WFF. In total, approximately $9 million in investor money was disbursed from the P2 Fund pursuant to the P2 Loan.
As WELLNER and BERGSTEIN well knew, however, P2 Fund investors were neither informed of the existence of the P2 Loan nor given any information about Arius Libra. And no disclosures were made to inform either P2 Fund or WFF investors of the conflict of interest arising from the P2 Fund’s security interest in WFF assets, as WELLNER and BERGSTEIN also knew. And although BERGSTEIN had represented to Weston that disbursements made pursuant to the P2 Loan would be used both to pay off Gerova creditors and to fund Arius Libra’s medical billing businesses, in fact, BERGSTEIN misappropriated a substantial portion of the P2 Loan proceeds and used them to pay for, among other things, his own personal expenses, including credit card bills and attorney’s fees.
The TT Portfolio Swap Agreement Scheme
In late 2011, BERGSTEIN and WELLNER secretly arranged for Weston’s TT Portfolio to enter into a swap agreement with an entity controlled by BERSTEIN known as Swartz IP Services (“Swartz IP”), a transaction that was not disclosed to TT Portfolio investors. As part of this swap agreement, WELLNER and others transferred approximately $17.7 million from the TT Portfolio to Swartz IP. In exchange, BERGSTEIN agreed to provide certain investment returns and to meet investor redemption requests.
This transaction was completed without disclosure to investors, even though, for other swap agreements, Weston had amended the TT Portfolio offering memorandum to reflect the particular swap agreement at issue. Of the money that was transferred to Swartz IP, moreover, BERGSTEIN and WELLNER directed that approximately $3 million be transferred to the P2 Fund to pay back part of the P2 Loan. BERGSTEIN and WELLNER thus directed that money from one set of Weston’s investors (the TT Portfolio investors) be used to pay back part of a debt owed to another set of Weston’s investors (the P2 Fund investors) – another conflict of interest that was not disclosed to P2 or TT Portfolio investors.
In addition to diverting TT Portfolio money for unauthorized and improper investments, WELLNER and other Weston officers improperly paid themselves with TT Portfolio investor money, which was not disclosed to investors. As a further part of the scheme, moreover, BERGSTEIN made false representations about Swartz IP’s assets and ability to meet redemption requests and secretly diverted TT Portfolio investor proceeds to pay BERGSTEIN’s personal expenses, among other things.
BERGSTEIN and WELLNER also gave a false and misleading investor presentation, made false investment disclosures, and distributed a fake loan note concealing the origin of the P2 Loan in order to attempt to conceal their criminal conduct.
* * *
BERGSTEIN, 54, of Hidden Hills, California, and WELLNER, 49, of Manhattan, are charged with the offenses set forth in the chart attached to this release. The statutory maximum sentences are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendants would be determined by the judge.
Mr. Bharara praised the investigative work of the FBI, IRS-CI, and the Office’s Criminal Investigators. He also thanked the Securities and Exchange Commission, which has filed civil charges against BERGSTEIN in a separate action.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Edward A. Imperatore and Robert W. Allen are in charge of the prosecution.
The allegations contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
COUNT
CHARGE
DEFENDANTS
MAXIMUM PENALTIES
1
Conspiracy to Commit Investment Adviser Fraud and Securities Fraud (18 U.S.C. § 371)
DAVID BERGSTEIN
KEITH WELLNER
Five years in prison and a $250,000 fine or twice the gross gain or loss from the offense
2
Investment Adviser Fraud (15 U.S.C. §§ 80b-6 & 80b-17; 18 U.S.C. § 2)
DAVID BERGSTEIN
KEITH WELLNER
Five years in prison and a fine of $10,000
3
Investment Adviser Fraud (15 U.S.C. §§ 80b-6 & 80b-17; 18 U.S.C. § 2)
DAVID BERGSTEIN
KEITH WELLNER
Five years in prison and a fine of $10,000
4
Securities Fraud (15 U.S.C. §§ 78j(b) & 78ff; 17 C.F.R. § 240.10b-5; 18 U.S.C. § 2)
DAVID BERGSTEIN
KEITH WELLNER
20 years in prison and a $5,000,000 fine or twice the gross gain or loss from the offense
5
Securities Fraud (15 U.S.C. §§ 78j(b) & 78ff; 17 C.F.R. § 240.10b-5; 18 U.S.C. § 2)
DAVID BERGSTEIN
KEITH WELLNER
20 years in prison and a $5,000,000 fine or twice the gross gain or loss from the offense
6
Wire Fraud (18 U.S.C. §§ 1343 and 2)
DAVID BERGSTEIN
KEITH WELLNER
20 years in prison and a $250,000 fine or twice the gross gain or loss from the offense
7
Conspiracy to Commit Wire Fraud (18 U.S.C. § 1349)
DAVID BERGSTEIN
20 years in prison and a $250,000 fine or twice the gross gain or loss from the offense
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth below constitute only allegations, and every fact described should be treated as an allegation.
Majority Owner of NECC and Husband Sentenced for Illegal Cash Withdrawals Following OutbreakRead the Press Release
BOSTON – The majority owner of New England Compounding Center (NECC) and her husband were sentenced today in U.S. District Court in Boston in connection with illegally withdrawing cash following the 2012 fungal meningitis outbreak.
Carla Conigliaro, 53, of Dedham, Mass., the majority owner of NECC was sentenced by U.S. District Court Judge Richard G. Stearns to one year of probation and ordered to forfeit $4,600 and to pay a fine of $4,500. Her husband, Douglas Conigliaro, 55, also of Dedham, Mass., was sentenced by Judge Stearns to two years of probation and ordered to forfeit $119,647 and to pay a fine of $55,000. In July 2016, they each pleaded guilty to withdrawing cash from their bank accounts in a manner intended to defeat financial reporting requirements.
In September 2012, a nationwide outbreak of fungal meningitis was traced back to contaminated vials of preservative-free methylprednisolone acetate (MPA) manufactured by NECC, a compounding pharmacy located in Framingham, Mass. Beginning on Oct. 31, 2012, the day a search warrant was executed at NECC, Carla and Douglas Conigliaro began withdrawing unusual sums of cash from their personal bank accounts. The cash transactions were structured by the Conigliaros in a manner so as to evade the $10,000 reporting requirement for the filing of a currency transaction report. The Conigliaros admitted to withdrawing $124,000 in cash in this manner.
In December 2014, following a two-year investigation, the Conigliaros and 12 other employees and associates of NECC were charged in a federal indictment. The indictment did not charge the Conigliaros with having an active role in the operations or management of NECC, but did charge them with transferring assets following the fungal meningitis outbreak.
NECC’s owner and head pharmacist Barry J. Cadden and supervisory pharmacist Glenn A. Chin were charged with 25 racketeering acts of second-degree murder in seven states. Ten other defendants, including six pharmacists, the director of operations, the national sales director, an unlicensed pharmacy technician, and another owner, were charged with additional crimes including racketeering, mail fraud, conspiracy, and violations of the Food, Drug and Cosmetic Act. Cadden and Chin are scheduled to stand trial on Jan. 5, 2017.
United States Attorney Carmen M. Ortiz; Jeffrey J. Ebersole, Special Agent in Charge of the U.S. Food and Drug Administration, Office of Criminal Investigations, New York Field Office; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Donna Nieves, Special Agent in Charge of the U.S. Department of Veterans Affairs, Office of Inspector General, Northeast Field Office; Craig Rupert, Special Agent in Charge of the U.S. Department of Defense, Office of Inspector General, Defense Criminal Investigative Service, Northeast Field Office; and Shelly Binkowski, Inspector in Charge of the U.S. Postal Inspection Service, made the announcement today. The case is being prosecuted by Assistant U.S. Attorneys George P. Varghese and Amanda P.M. Strachan of Ortiz’s Health Care Fraud Unit and John W.M. Claud of the Justice Department’s Consumer Protection Branch.
The details contained in the indictment are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt.
Major Drug Courier Sentenced to 20 Years in PrisonRead the Press Release
NEWPORT NEWS, Va. – Juan Guzman, 43, of El Paso, Texas, was sentenced today to 240 months in prison for conspiracy to distribute more than five kilograms of cocaine and more than 100 kilograms of marijuana. The defendant was also sentenced to 120 months of supervised release following his term of imprisonment.
Guzman was found guilty on April 14, 2016. According to court documents and information presented at trial, Guzman was responsible for using tractor-trailers to transport multi-kilo loads of cocaine and marijuana from Texas and New Mexico to locations along the East Coast, including Georgia, Rhode Island and Virginia.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, made the announcement after sentencing by U.S. District Judge Arenda Wright Allen. Assistant U.S. Attorney Eric M. Hurt and Special Assistant U.S. Attorney Matthew Hoff of the Organized Crime and Gang Section of the Department of Justice prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:15-cr-34.
Longtime fugitive Eric Bartoli sentenced to 20 years in prison for defrauding hundreds of peopleRead the Press Release
Eric V. Bartoli, who a fugitive for more than a decade, was sentenced to 20 years in prison for defrauding hundreds of investors out of millions of dollars in the 1990s, law enforcement officials said.
Bartoli pleaded guilty earlier this year to eight counts, including conspiracy, securities fraud, sale of unregistered securities, wire fraud, mail fraud and attempted income tax evasion.
Bartoli operated a large-scale Ponzi scheme from 1995 through 1999. He created and operated a company by the name of Cyprus Funds, Inc., which was based in Doylestown, Ohio and incorporated in Central America. Bartoli and his co-conspirators operated Cyprus to sell certificates of deposit and unregistered mutual funds. Cyprus raised approximately $65 million from an estimated 800 investors in Latin America and the United States. Some of Cyprus’s victims included retirees, according to court records.
Bartoli was sued in 1999 by the Securities and Exchange Commission on charges involving the Cyprus Funds, Inc. Bartoli did not appear at a scheduled hearing regarding the SEC charges. He was subsequently found in contempt of court and a civil arrest warrant was issued. Bartoli had fled Ohio and was arrested in New Hampshire. Bartoli was not detained at that time and became a fugitive.
An indictment was filed against Bartoli in the U.S. District Court for the Northern District of Ohio in October 2003.
Bartoli was taken into custody by the Peruvian National Police in Lima, Peru, in 2013. The operation was a joint effort between the FBI, Diplomatic Security Service, and the Peruvian National Police. He was returned to the United States last year.
“Mr. Bartoli spent years stealing millions of dollars from hard-working people, then more than a decade on the run,” said U.S. Attorney Carole S. Rendon. “Sometimes the wheels of justice grind slowly, but today Mr. Bartoli was finally held accountable for his crimes. The fact that he will spend the foreseeable future in prison is a testament to the efforts of everyone who worked on this case.”
“After years of living on the run, Mr. Bartoli will now serve time behind bars for swindling individuals out of large sums of money, including entire life savings,” said FBI Special Agent in Charge Stephen D. Anthony. “The FBI will continue to investigate fraudsters, like Eric Bartoli, and will hold them accountable for their criminal behavior, no matter how long it takes and no matter where they try to hide."
“More than a decade has passed since Mr. Bartoli’s criminal actions were brought to light in an indictment. Well, today marks the end of a long successful investigation that uncovered a multi-million dollar Ponzi scheme laced with a web of financial lies that left 800 investors in financial peril,” said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. “The IRS, FBI, and the U.S. Attorney’s Office never stopped pursuing Mr. Bartoli, proving that you can run, but you cannot hide from the federal government.”
This case is being prosecuted by Assistant U.S. Attorneys Antoinette T. Bacon and Christos M. Georgalis following an investigation by the Federal Bureau of Investigation, Internal Revenue Service and the Securities and Exchange Commission.
Lee's Summit Business Owner Sentenced for Underpaying EmployeesRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Lee’s Summit, Mo., business owner was sentenced in federal court today for underpaying his employees in violation of the Fair Labor Standards Act.
Gary L. Walker, 51, of Lee’s Summit, was sentenced by U.S. Magistrate Judge Robert E. Larsen to five years of probation. The court also ordered Walker to pay $196,484 in restitution to his former employees.
“This company’s former employees will not only receive the wages they rightfully earned, but will be paid restitution of twice the amount they were unfairly denied,” Dickinson said. “I will uphold the rights of employees and prosecute employers who violate federal laws designed to protect workers.”
Walker, who pleaded guilty to the misdemeanor charge on April 7, 2016, was the owner of Magic Touch Cleaning, Inc., a commercial janitorial business providing services to banks and health care companies.
“Gary Walker provided falsified records to the U.S. Department of Labor in order to conceal his failure to pay nearly $100,000 in wages to his employees. We will continue to work with our departmental and other law enforcement partners to ensure that employers do not victimize American workers by denying them the wages they have earned,” stated Steven Grell, Special Agent-in-Charge, of the Dallas Regional Office of the U.S. Department of Labor, Office of Inspector General.
Walker’s employees were entitled to a minimum wage of $7.25 per hour and overtime pay at a rate of at least one and half times the regular rate of pay after 40 hours of work in a work-week. From 2010 through Aug. 3, 2013, Magic Touch Cleaning underpaid its employees approximately $98,242 in unpaid minimum wages and overtime. The amount of victim restitution ordered by the court today represents these unpaid wages and overtime, which is doubled in a violation of the wage and hour laws and regulations. Walker will make payments of a minimum of $50,000 each year until the full amount of restitution is paid.
Under the terms of Walker’s plea agreement, the government will dismiss the civil action filed against him and his company in Perez v. Magic Touch Cleaning, Inc. et al (Case No. 15-CV-00174-SWH).
This case was prosecuted by Assistant U.S. Attorney Paul S. Becker. It was investigated by the U.S. Department of Labor, Office of Inspector General.
Lafayette man pleads guilty to felony possession of firearm, ammunitionRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced that a Lafayette man pleaded guilty Tuesday to illegally possessing a revolver and bullets after being convicted of a felony.
Shawn D’Anthony Brown, 20, of Lafayette, pleaded guilty before U.S. Magistrate Judge Carol B. Whitehurst to one count of felon in possession of a firearm. The plea will become final when accepted by U.S. District Judge Patricia Minaldi. According to the guilty plea, Lafayette police stopped a black four-door vehicle not using headlights on September 27, 2015 on Celeste Street. Brown was searched, and a loaded .32 caliber revolver spray-painted gold was found in his front right pocket. At the time of the offense, Brown had two previous felony convictions.
Brown faces up to 10 years in prison, three years of supervised release, forfeiture of the seized items and a $250,000 fine. A sentencing date of February 23, 2017 was set.
This investigation and prosecution is part of Project Safe Neighborhoods, which is a Department of Justice initiative to promote firearm safety and to reduce firearm crimes by preventing the possession and use of firearms by dangerous and persistent felons and others not authorized to possess a firearm.
The ATF and Lafayette Police Department conducted the investigation. Assistant U.S. Attorney Daniel J. McCoy is prosecuting the case.
Jury Convicts Wichita Man on Federal Drug, Gun ChargesRead the Press Release
WICHITA, KAN. – A jury today convicted a Wichita man on federal drug and firearm charges, U.S. Attorney Tom Beall said.
Jesus Reyes, 42, Wichita, was convicted on one count of possession of with intent to distribute methamphetamine and two counts of unlawful possession of a firearm following a felony conviction.
During trial, prosecutors presented evidence that Wichita police stopped Reyes May 20, 2015, near 11th and Perry for a traffic violation. They found two loaded firearms and two plastic bags containing methamphetamine in the car. He was prohibited from possessing firearms due to a prior felony conviction.
Sentencing is set for Jan. 30. He faces a maximum penalty of 20 years in federal prison and a fine up to $1 million on the drug charge, and a maximum penalty of 10 years and a fine up to $250,000 on each of the firearm charges. Beall commended the Wichita Police Department, Special Assistant U.S. Attorney Kimberley Rodebaugh and Special Assistant U.S. Attorney Michelle Jacobs for their work on the case.
Jury Convicts Man of Coercion and Enticement of A MinorRead the Press Release
LAS VEGAS, Nev. –A Henderson, Nev., man was convicted Tuesday of coercion and enticement of a minor to engage in illegal sexual activity, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.
Following a two-day jury trial, Kenneth Gordon Wescott, 54, was convicted of one count of coercion and enticement of a minor. He was indicted by a grand jury on March 11, 2014. United States District Judge Andrew P. Gordon presided over the jury trial. A sentencing date has been scheduled for Feb. 16, 2017.
“The defendant engaged in sexually explicit communications and grooming behavior with someone whom he believed to be a 13-year-old girl. Fortunately, he was communicating with an undercover officer,” said U.S. Attorney Bogden. “We will continue to work with our law enforcement partners to protect children from sexual predators.”
According to court records and evidence presented at trial, on or about Dec. 12, 2013 and Jan. 4, 2014, Wescott engaged in a series of emails and text messages with someone whom he believed to be a 13-year-old girl. Wescott posted a provocative ad on mymojovillage.com. An undercover officer with the Henderson Police Department posed as an underage girl and responded to Westcott’s ad. Westcott used the email exchanges to build a relationship with the girl and continued to engage in sexually explicit language. Wescott asked for a face to face meeting with the girl and was arrested at the meeting place.
The case was investigated by the FBI and the Henderson Police Department. The case was prosecuted by Assistant U.S. Attorneys Kilby C. Macfadden and Cristina D. Silva.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. 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 and for information about internet safety education, please visit www.justice.gov/psc.
###
Jefferson County man pleads guilty to unlawful possession of firearmRead the Press Release
MARTINSBURG, WEST VIRGINIA – Norman Charles Hilbert, 48, of Harpers Ferry, West Virginia, pled guilty in federal court today to illegally possessing a firearm, United States Attorney William J. Ihlenfeld, II, announced.
Hilbert, who was previously convicted of a felony in Connecticut, was discovered in possession of a .45 caliber pistol in Jefferson County, West Virginia. He pled guilty to one count of “Felon in Possession of Firearm,” and he now faces up to ten years in prison and a fine of up to $250,000. 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 Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Charles Town Police Department investigated.
U.S. Magistrate Judge Robert W. Trumble presided.
Jefferson City Man Sentenced for Illegal FirearmRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Jefferson City, Mo., man was sentenced in federal court today for illegally possessing a firearm.
Charles Allen Roark, 38, of Jefferson City, was sentenced by U.S. District Judge Stephen R. Bough to 12 years in federal prison without parole – 10 years, which is the statutory maximum penalty for the offense, plus a consecutive sentence of two years for his supervised release revocation (Roark was on supervised release as part of a federal sentence for a prior conviction of distributing crack cocaine and being a felon in possession of a firearm).
On July 18, 2016, a jury found Roark guilty of being a felon in possession of a firearm. Evidence introduced during the trial indicated that Roark was in possession of a loaded Smith and Wesson .40-caliber pistol on July 18, 2015.
On that date, Jefferson City police officers activated their emergency lights to pull over Roark for having expired license plates. Roark, however, refused to stop and continued driving to the 300 block of Washington Street, where he pulled into a parking lot, got out of his vehicle and fled on foot. Officers pursued Roark on foot. During the pursuit, Roark pulled a pistol from his waistband and threw it on the ground. Roark scaled a fence and continued to flee.
An officer was able to grab Roark and take him to the ground. Roark continued to resist, but officers were able to gain control and was forcibly taken into custody at gunpoint. During the pursuit, one of the officers broke his ankle.
Officers found the loaded pistol lying on the ground during a search of the area. Roark was in possession of $20,131, of which $8,151 was recovered from underneath the soles of his shoes.
Under federal law, it is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. Roark has prior federal felony convictions for distributing controlled substances and being a felon in possession of a firearm. Roark also has two prior state felony convictions for possession of controlled substances, two prior state felony convictions for assault, and prior state felony convictions for driving while intoxicated and unlawful use of a weapon.
This case was prosecuted by Assistant U.S. Attorney Jim Lynn. It was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Jefferson City, Mo., Police Department.
Jefferson City Man Sentenced for Child PornographyRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Jefferson City, Mo., man was sentenced in federal court today for possessing and receiving child pornography over the Internet.
Ryan Michael Moberg, 37, of Jefferson City, was sentenced by U.S. District Judge Stephen R. Bough to five years in federal prison without parole.
Moberg was convicted at trial on July 12, 2016. Evidence introduced during the trial indicated that Moberg utilized a peer-to-peer file-sharing program to access child pornography over the Internet. In November 2012, a Boone County, Mo., Sheriff’s Department detective identified Moberg’s computer as sharing files online. One of the video files on Moberg’s computer depicted a young girl engaged in sexual activity with a dog.
Law enforcement officers executed a search warrant at Moberg’s residence in April 2013 and seized an Acer tower computer. Moberg was not home at the time the warrant was executed; investigators went to his workplace and interviewed him. Moberg admitted to investigators that he searched for child pornography online and downloaded it to his computer.
This case was prosecuted by Assistant U.S. Attorney Jim Lynn. It was investigated by the Boone County, Mo., Sheriff’s Department and the Jefferson City, Mo., Police Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Heroin Dealer Sentenced to 30 Years in Prison for Overdose DeathRead the Press Release
NORFOLK, Va. – Carlos A. Brown, 46, of Suffolk, was sentenced today to 360 months in prison for distribution of heroin resulting in death.
According to court documents, Brown sold heroin from his Portsmouth residence from June 2015 to November 2015. On Nov. 18, 2015, Brown contacted one buyer describing the potency of his heroin as a “missile.” He was aware that several of his customers had overdosed, yet sought to obtain more of that same batch of heroin. Shortly thereafter, Brown distributed that heroin and in the early morning hours of Nov. 21, 2015, Ryan Wilson, 27, of Chesapeake, was found dead having used Brown’s heroin. Even after learning of the death of Ryan Wilson, Carlos Brown continued to sell heroin. The law enforcement team made four controlled purchases of heroin and fentanyl from Brown before they arrested him on April 21.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Mark R. Herring, Attorney General of Virginia; Martin Culbreath, Special Agent in Charge of the FBI’s Norfolk Field Office, Kelvin L. Wright, Chief of the Chesapeake Police Department; and Colonel W. Steven Flaherty, Superintendent of Virginia State Police, made the announcement after sentencing by U.S. District Judge Mark S. Davis. Virginia Assistant Attorney General and Special Assistant U.S. Attorney John F. Butler and Assistant U.S. Attorneys Andrew C. Bosse and Joseph E. DePadilla prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:16-cr-67.
Harrison County man sentenced for unlawful possession of a firearmRead the Press Release
CLARKSBURG, WEST VIRGINIA – David Keith Stover, Jr., 37, of Stonewood, West Virginia, was sentenced to 36 months in prison for unlawfully possessing a firearm, United States Attorney William J. Ihlenfeld, II, announced.
Stover, who had previously been convicted of a felony offense in Harrison County, West Virginia, was discovered in possession of three rifles in May 2015. He pled guilty to one count of “Felon in Possession of a Firearm” in August 2016.
Assistant U.S. Attorney David J. Perri prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Stonewood Police Department investigated.
U.S. District Judge Irene M. Keeley presided.
Grand Jury Indicts Former Erie Man for Violating Federal Firearms LawsRead the Press Release
ERIE, Pa. - A former resident of Erie, Pennsylvania, has been indicted by a federal grand jury in Erie on charges of violating federal firearm laws, United States Attorney David J. Hickton announced today.
The two-count indictment named Ezra Eugene Davis, 32, as the sole defendant.
According to the indictment presented to the court, on October 21, 2016, Davis possessed seven firearms while released on bond awaiting trial on local gun and drug charges. Davis was also charged with the knowing possession of stolen firearms and with possession of firearms while a current user of controlled substances.
The law provides for a maximum total sentence of 15 years in prison, a fine of $500,000 or both. 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 defendant.
Assistant United States Attorney Marshall J. Piccinini is prosecuting this case on behalf of the government.
This case was prosecuted as part of Project Safe Neighborhoods, a collaborative effort by federal, state, and local law enforcement agencies, prosecutors, and communities to prevent, deter, and prosecute gun crime.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Millcreek Township Police Department 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.
Futures Trader Pleads Guilty to Illegally Manipulating the Futures Market in Connection with 2010 “Flash Crash”Read the Press Release
A British futures trader pleaded guilty today to U.S. fraud and spoofing charges in connection with an over five-year scheme to defraud, which included his role in the May 6, 2010, “Flash Crash,” when the Dow Jones Industrial Average plunged 600 points in five minutes, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Special Agent in Charge Michael J. Anderson of the FBI’s Chicago Field Office and Director Aitan Goelman of the U.S. Commodity Futures Trading Commission (CFTC) Division of Enforcement.
Navinder Singh Sarao, 37, of Hounslow, United Kingdom, pleaded guilty to one count of wire fraud and one count of spoofing before U.S. District Judge Virginia Kendall of the Northern District of Illinois. Saro was extradited to the United States on Nov. 7 and made his first court appearance today.
“Navinder Sarao abused sophisticated technology to make a quick profit, and jeopardized the integrity of U.S. financial markets,” said Assistant Attorney General Caldwell. “By flooding the marketplace with bogus orders, his scheme victimized countless individuals. Our success in bringing Sarao to justice in the United States shows that the Criminal Division will root out complex financial fraud and manipulation of the financial markets no matter where the perpetrators are located.”
“This case shows just how seriously we take threats to the integrity of our markets, from wherever they emanate,” said Director Goelman. “The CFTC appreciates Department of Justice's doggedness in ensuring that Sarao faces justice for the harm he caused to the U.S. futures market, despite his being situated an ocean away from American shores, as well as for the assistance of our other law enforcement partners, the FBI and Scotland Yard.”
As part of his guilty plea, Sarao admitted that he used an automated trading program, along with other techniques, to manipulate the market for E-mini Standard & Poor’s (S&P) 500 futures contracts (E-minis), stock market index futures contracts based on the S&P 500 index, through the Chicago Mercantile Exchange (CME). The E-mini S&P 500 is considered among the most widely traded financial products in the world. Sarao admitted that he placed thousands of orders that he did not intend to trade, or “spoof orders,” to create the appearance of substantial false supply and demand and to induce other market participants to trade E-minis at prices and quantities they normally would not have traded. In thousands of instances, Sarao admitted, he was able to induce other market participants into buying or selling E-minis by placing the spoof orders, which had the additional purpose and effect of artificially depressing or artificially inflating the price of E-minis. On the day of the “Flash Crash,” Sarao entered at least 85 spoof orders to sell E-minis, which, at various times throughout that day, represented well over 20 percent of all E-mini sell orders visible to the market, he admitted.According to the plea agreement, in instances when a market reaction occurred, Sarao frequently executed real, genuine orders to buy (typically at artificially low prices) or sell (typically at artificially high prices) E-minis. He admitted that he frequently was able to generate significant trading profits from buying and selling his genuine orders close in time with the placement of the spoof orders. As a result of his scheme, Sarao admitted that he was able to make at least $12.8 million in illicit gains.
The FBI’s Chicago Division is investigating the case. Assistant Chief Robert Zink and Trial Attorney Michael T. O’Neill of the Criminal Division’s Fraud Section are prosecuting the case with assistance from the U.S. Attorney’s Office for the Northern District of Illinois, the Criminal Division’s Office of International Affairs and the International Assistance Unit of the Metropolitan Police Service of London. The CFTC’s Division of Enforcement provided substantial assistance in this case and referred this matter to the department.Former Officer with U.S. Citizenship and Immigration Services Sentenced to nearly 3 Years in Federal Prison in Bribery CaseRead the Press Release
LOS ANGELES – A former immigration services officer with U.S. Citizenship and Immigration Services (USCIS) who had the power to approve applications for citizenship has been sentenced to 33 months in federal prison for taking tens of thousands of dollars in bribes.
Daniel Espejo Amos, 68, of Lakewood, was sentenced late Friday afternoon by United States District Judge Michael W. Fitzgerald.
Amos pleaded guilty in April to one count of conspiracy and one count of being a public official who accepted cash bribes. When he pleaded guilty, Amos admitted that he accepted more than $53,000 in bribes from immigration consultants on behalf of immigrants who were not eligible to become naturalized United States citizens.
“This defendant violated his oath to the United States by accepting more than $53,000 in cash bribes in exchange for helping at least 60 aliens to obtain U.S. citizenship – even though he knew the immigrants did not qualify for this benefit,” said United States Attorney Eileen M. Decker. “This defendant’s corruption also undermined our naturalization system and damaged the public’s faith in government, warranting the sentence imposed by the court.”
In a plea agreement filed in this case, Amos admitted accepting bribes in exchange for committing official acts, including falsely certifying that immigrants had met requirements for citizenship that include “passing” the English competency and civics portions of the naturalization interview and examination administered by USCIS. In at least one case, the immigrant’s English-language skills were so poor that Amos gave him copies of test answers so the immigrant could memorize them prior to his naturalization interview.
The case against Amos is part of an investigation by the U.S. Department of Homeland Security’s Homeland Security Investigations (HSI); the U.S. Department of Homeland Security, Office of the Inspector General; and the Federal Bureau of Investigation.
“As the largest investigative arm of the Department of Homeland Security, one of HSI’s top enforcement priorities is targeting the criminals and criminal organizations that undermine the integrity of our nation’s legal immigration system,” said Joseph Macias, special agent in charge for HSI Los Angeles. “We will continue to work with our counterparts to investigate those who misuse their positions of authority to manipulate and exploit that system for their own personal financial gain."
John Roth, Department of Homeland Security Inspector General, stated that “The Office of Inspector General is committed to working with our law enforcement partners to aggressively investigate all allegations of corruption by DHS employees, ensuring the integrity of DHS programs, personnel, and operations.”
This case was prosecuted by Assistant United States Attorney Elisa Fernandez of the Public Corruption and Civil Rights Section.
Former New York City Building Inspector and the Owner of A Demolition Company Indicted for ExtortionRead the Press Release
A one-count indictment was unsealed today in United States District Court for the Eastern District of New York charging Massimo Dabusco, also known as “Max,” and Vito Menadi with conspiracy to commit extortion. The indictment was returned under seal by a federal grand jury sitting in Brooklyn on November 1, 2016, and relates to Dabusco’s alleged activities as an Inspector with the New York City Department of Buildings (DOB) and his silent partnership with Menadi in A&G Contracting Group Corp. (A&G), a demolition and excavation company. Dabusco resigned from his job as a DOB Inspector in August 2015.
The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Mark G. Peters, Commissioner New York City Department of Investigation.
The indictment alleges that Dabusco served as a silent partner to Menadi in A&G in violation of the New York City law. Further, Dabusco used his official position to influence property owners and contractors, over whom Dabusco had regulatory authority, to hire A&G and Menadi to perform excavation and demolition jobs. As part of his efforts to secure business for A&G, Dabusco illegally warned contractors about impending DOB inspections. In exchange for his conduct, Dabusco received a share of A&G’s profits.
Additionally, Dabusco allegedly abused his position as a DOB Inspector by threatening punitive action against contractors and property owners in an effort to benefit Menadi and A&G. For instance, Dabusco threatened to use his authority as a DOB Inspector to shut down all of a contractor’s existing jobs if the contractor did not pay outstanding fines owed by Menadi and A&G.
“New York City’s Building Inspectors are entrusted with a vitally important public safety mission. Today’s indictment makes clear that public officials who place personal gain above this public trust and those who assist those officials in such corrupt practices, will be aggressively prosecuted. Maintaining safe buildings and safeguarding the health and wellbeing of New Yorkers demands no less,” stated United States Attorney.
“Public officials, whether elected, appointed, or employed, have a duty to maintain honest and faithful public service. Using your position to influence the decisions of others, and receiving something of value in return, is a direct violation of the law. As alleged, Dabusco may have tried to build up his business by engaging in corrupt activity, but now he’ll have to answer for his actions,” stated FBI Assistant Director-in-Charge Sweeney.
DOI Commissioner Peters said, “Once again, DOI, along with its law enforcement partners, has found a City building inspector corruptly abusing his power and authority, conspiring with his co-defendant to shakedown property owners by threatening them with DOB violations, and pressuring them to steer business to a preferred contracting company, according to the charges. This investigation demonstrates the importance of coordination between the United States Attorney’s Office for the Eastern District of New York and the Federal Bureau of Investigation and the need for DOI to continue its enforcement efforts in the building and construction industry.”
The defendants are scheduled to be arraigned this afternoon before United States Magistrate Judge Steven L. Tiscione at the federal courthouse in Brooklyn. The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being prosecuted by Assistant United States Attorney Martin Coffey.
The Defendants:
MASSIMO DABUSCO
Age: 54
Yorktown Heights, New YorkVito Menadi
Age: 43
Brooklyn, New York,E.D.N.Y. Docket No.16 Cr 0559(ILG)
Former Navy Recruiter Sentenced to 17 Years on Child Coercion and Enticement ChargesRead the Press Release
ASHEVILLE, N.C. – U.S. District Court Judge Max O. Cogburn, Jr. sentenced yesterday a Weaverville, N.C. man to 204 months in prison on child coercion and enticement charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Judge Cogburn also ordered Benjamin Ernest Johnson, 39, to serve a lifetime of supervised release and to register as a sex offender after he is released from prison. Johnson pleaded guilty in May 2016 to one count of Coercion and Enticement of a minor.
John A. Strong, Special Agent in Charge of the FBI in North Carolina, and Sheriff Van Duncan of the Buncombe County Sheriff’s Office join U.S. Attorney Rose in making today’s announcement.
“Johnson was a wolf among sheep, a predator who took advantage of his access to high school students and used his position of trust to sexually exploit impressionable young victims. His conduct is not only a disgrace to all military personnel, it is also criminal. And for that, he will deservedly serve time in federal prison,” said U.S. Attorney Rose.
“Benjamin Johnson was trusted to advise young people about the benefits of a military career. Instead, he used that access to manipulate children for his own vile sexual gratification. The FBI has zero tolerance for those who prey on our children,” said Special Agent in Charge Strong.
“No form of sexual misconduct is ever acceptable anywhere in the Department of the Navy. Ensuring the safety of our Navy applicants and members of the communities we work in is our top priority. Upon notice of the allegations of misconduct with a minor, the former service member was immediately removed from all recruiting duties and subsequently discharged from the Navy. We will continue to train our Navy recruiters on appropriate behavior when working with Navy applicants and we will continue to enforce high standards and professional conduct,” said
Commander Stan Dickerson, Commanding Officer Naval Recruiting District Raleigh.According to filed court documents and yesterday’s sentencing hearing, in February 2014 Johnson was a United States Navy Petty Officer First Class on active duty stationed in Asheville. Johnson’s duties were to conduct recruiting of high school students in Western North Carolina. According to court records, sometime in the fall of 2013, Johnson was assigned as a recruiter at a high school in Buncombe County. Over the course of his official duties as a recruiter, Johnson met child victim one (CV1), a 15-year-old female high school student who was enrolled in the school’s Naval Junior Reserve Officer Training Corps (NJROTC). Court records indicate that Johnson began to communicate with CV1 via instant messaging, and over the course of their exchanges Johnson solicited and received sexually explicit images of CV1. Johnson also sent the minor sexually explicit images of himself.
According to court records, Johnson also solicited sexually explicit photos from another child victim (CV2) Johnson met in 2011 when the victim was a freshman in high school. Johnson maintained a relationship with CV2 until March 2014. Court records indicate that Johnson met the victim when he was a recruiter at CV2’s high school, where the victim was a NJROTC student. According to court records, CV2 and Johnson became friends on social media after the victim enrolled in a different high school in the area. Court records show that Johnson induced CV2 to send him multiple sexually explicit images of herself via instant messaging. Johnson also sent CV2 multiple sexually explicit images of himself. According to court records, CV2 indicated that she and Johnson had scheduled an upcoming trip to a military testing location and Johnson was going to use it as an opportunity to have physical contact with the victim.
In announcing today’s sentence Judge Cogburn said, “This is a serious crime with a serious punishment.”
Johnson has been in custody since May 11, 2016. He will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentencings are served without the possibility of parole.
The FBI and the Buncombe County Sheriff’s Office led the investigation and were assisted by the Asheville Police Department. In making today’s announcement, U.S. Attorney Rose also thanked the Department of the Navy for their cooperation and assistance with the investigation.
Assistant United States Attorney David A. Thorneloe of the U.S. Attorney’s Office in Asheville prosecuted the case.
Former Boston Police Officer Sentenced for Access Device FraudRead the Press Release
BOSTON – A former Boston Police Officer was sentenced yesterday in connection with purchasing and using gift cards obtained from the return of stolen merchandise.
Eddie Odney, 38, was sentenced by U.S. District Court Senior Judge Mark L. Wolf to 36 months of probation, a fine of $10,000 and forfeiture of $1,600.
In August 2016, Odney pleaded guilty to one count of access device fraud and, as part of his plea agreement, resigned as a Boston Police Officer.
Over the course of over a year and a half, including all of 2015, Odney purchased approximately $5,000 worth of gift cards that he knew were obtained from the return of stolen merchandise at stores including T.J. Maxx, Macy’s, and HomeGoods. Odney paid cash for the cards and used them to make over $1,600 in purchases in 2015.
United States Attorney Carmen M. Ortiz; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation; and Superintendent Frank Mancini of the Boston Police Department’s Anti-Corruption Division; made the announcement. The case was prosecuted by Assistant U.S. Attorney Eugenia M. Carris of Ortiz’s Public Corruption Unit.
Former Background Investigator for Federal Government Sentenced for Making a False StatementRead the Press Release
WASHINGTON – Edward J. Kincade, 63, a former background investigator who did work under contract for the U.S. Office of Personnel Management (OPM), was sentenced today to 60 days of incarceration for his falsification of work on background investigations of federal employees and contractors, announced U.S. Attorney Channing D. Phillips and Norbert E. Vint, Deputy Inspector General for the Office of Personnel Management (OPM).
Kincade, of Guyton, Ga., pled guilty in August 2016, in the U.S. District Court for the District of Columbia, to making a false statement. He was sentenced by the Honorable Randolph D. Moss. Following the period of incarceration, Kincade will be placed on three years of supervised release; the first six months of that time must be spent on home detention. Kincade also must perform 100 hours of community service and pay $264,312 in restitution to the federal government.
According to a statement of offense submitted to the Court, Kincade was employed by USIS, formerly known as U.S. Investigations Services Inc. In that role, Kincade was an investigator under contract to conduct background investigations on behalf of OPM’s Federal Investigative Services, which now is known as the National Background Investigations Bureau.
Between August 2011 and September 2012, in more than 30 Reports of Investigations on background investigations, Kincade represented that he had interviewed a source or reviewed a record regarding the subject of the background investigation. In fact, he had not conducted the interviews or obtained the records of interest. These reports were utilized and relied upon by the agencies requesting the background investigations to determine whether the subjects were suitable for positions having access to classified information, for positions impacting national security, for receiving or retaining security clearances, or for positions of public trust.
Kincade’s false representations have required Federal Investigative Services to reopen and rework numerous background investigations that were assigned to him during the time period of his falsifications, at an estimated cost of at least $264,312 to the U.S. government.
Federal Investigative Services has a robust integrity assurance program which utilizes a variety of methods to ensure the accuracy of reported information. The falsification of investigative case work by the defendant was detected through the program.
This is one of numerous cases prosecuted by the U.S. Attorney’s Office for the District of Columbia since 2008 involving false representations by background investigators and record checkers working on federal background investigations. In addition to Kincade, 22 other background investigators and two record checkers have been convicted of charges.
Federal Investigative Services, through its workforce of approximately 5,400 field investigators, is responsible for conducting background investigations for numerous federal agencies and their contractors, on individuals either employed by or seeking employment with those agencies or contractors. Federal Investigative Services conducted more than 2.4 million investigations during the 2015 fiscal year. More than 600,000 of these investigations involved applicants for access or continued access to classified information.
In performing background investigations, the investigators conduct interviews of individuals who have information about the person who is the subject of the review. In addition, the investigators seek out, obtain, and review documentary evidence, such as employment records, to verify and corroborate information provided by either the subject of the background investigation or by persons interviewed during the investigation. After conducting interviews and obtaining documentary evidence, the investigators prepare a Report of Investigation containing the results of the interviews and document reviews, and electronically submit the material to OPM in Washington, D.C. OPM then provides a copy of the investigative file to the requesting agency, which can use the information to determine an individual’s eligibility for employment or a security clearance.
In announcing the sentence, U.S. Attorney Phillips and Deputy Inspector General Vint praised the efforts of Special Agent Shantel Robinson, OPM, Office of the Inspector General, and Philip Kroop, Kevin Cassidy, and Jeffrey Addicks, OPM, Federal Investigative Services. They also acknowledged the work of Paralegal Specialist Jessica Mundi of the U.S. Attorney’s Office, as well as Assistant U.S. Attorney Ellen Chubin Epstein, who investigated and prosecuted this matter.
Federal Racketeering Indictment Targets Wilmington Street GangRead the Press Release
LOS ANGELES – Authorities have arrested 17 members and associates of the Wilmas street gang who are named in a federal racketeering indictment that alleges acts of murder, attempted murder, narcotics trafficking, robbery and witness intimidation – as well as a series of armed attacks on law enforcement officers dating back to 2008.
The 17 people arrested this morning and late Tuesday are among 29 defendants named in a 111-page indictment that alleges violations of the federal Racketeer Influenced and Corrupt Organizations (RICO) Act. The arrests were made by officers with the Los Angeles Police Department, special agents with the Drug Enforcement Administration and other law enforcement authorities, including the United States Marshals Service and the FBI.
In addition to those arrested during the Operation “Tidal Wave,” 10 defendants were already in custody on unrelated charges. Authorities are continuing to search for two defendants.
During the course of the investigation, law enforcement seized nearly eight pounds of methamphetamine and 10 firearms, including one linked to a shooting.
“This federal indictment seeks to dismantle the leadership of the Wilmas street gang, a particularly violent street gang that regularly targets members of the community and law enforcement officers for murder,” said United States Attorney Eileen M. Decker. “The devastating impact that this gang has had on the community cannot be overstated, but today’s takedown will help to restore order across Wilmington and ensure that those responsible for the violence and other criminal acts will be taken off the streets for years.”
Operation Tidal Wave targeted the Wilmas gang, which has operated in the Wilmington District of Los Angeles since the 1950s and is affiliated with the Mexican Mafia. As a “surenos” gang, the Wilmas gang “is loyal to, supports and contributes to the Mexican Mafia,” according to the indictment, which outlines how leaders of the prison gang issues orders to kill rival gang members and members of law enforcement.
The federal indictment unsealed this morning outlines a criminal enterprise that controls the drug trade in Wilmington, collects “taxes” from drug dealers for the benefit of Mexican Mafia members, maintains a supply of often-illegal firearms, and takes retribution against people who may be cooperating with law enforcement. Wilmas gang members murdered two 16-year-old victims on February 26, 2012, according to the indictment.
“The Wilmas gang is also a racist organization and has been historically antagonistic to the presence of African-Americans in Wilmas gang territory,” the indictment alleges. “Wilmas gang members have frequently targeted African-Americans who enter or attempt to reside within the area claimed by the Wilmas gang.”
Operation Tidal Wave was conducted under the auspices of the Los Angeles High Intensity Drug Trafficking Area (HIDTA) Task Force, which is coordinated by the Drug Enforcement Administration.
“This joint investigation targeted a very violent and ruthless criminal gang that has terrorized the citizens of Wilmington for too long,” said DEA Special Agent in Charge Steve Comer. “The HIDTA Task Force is dedicated to dismantling the most prolific, local area drug trafficking organizations and today’s actions demonstrate that commitment – we’re allied with our law enforcement partners to make our communities safer.”
The 31-count indictment alleges a conspiracy to violate RICO; numerous criminal offenses that violated the RICO statute, including murder, distribution of methamphetamine, extortion, and witness tampering; violent crimes in aid of racketeering, conspiracy to trafficking narcotics, possession with the intent to distribute methamphetamine and one defendant is accused of being a felon in possession of a shotgun.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
Most of the 29 defendants named in the indictment face potential life sentences if they are convicted, and most potentially face mandatory minimum sentences of 10 years in federal prison.
This case is being prosecuted by Assistant United States Attorney Christopher Brunwin of the Violent and Organized Crime Section.
Executive Office for Immigration Review Expands Legal Orientation Program SitesRead the Press Release
FALLS CHURCH, Va. – The Executive Office for Immigration Review (EOIR) today announced the expansion of the Office of Legal Access Programs’ Legal Orientation Program (LOP) to three additional detention sites: Irwin County Detention Center in Ocilla, Ga.; Polk County Detention Center (IAH Secure) in Livingston, Texas; and Rolling Plains Detention Center in Haskell, Texas. Through the LOP, EOIR contracts with representatives from non-profit organizations to provide explanations about immigration court policies and procedures to groups of detained individuals. This new expansion brings the number of LOP sites to 41.
Since 2002, EOIR has carried out the LOP to improve judicial efficiency in the immigration courts, and to assist detained individuals and others involved in removal proceedings to make timely and informed decisions. Under the LOP, EOIR’s contractors provide group and individual orientations, self-help workshops, and pro bono referral services for individuals in removal proceedings.
Please see EOIR’s Office of Legal Access Programs Fact Sheet for more information on the LOP and EOIR's additional legal access programs.
The Executive Office for Immigration Review (EOIR) is an agency within the Department of Justice. Under delegated authority from the Attorney General, immigration judges and the Board of Immigration Appeals interpret and adjudicate immigration cases according to United States immigration laws. EOIR’s immigration judges conduct administrative court proceedings in immigration courts located throughout the nation. They determine whether foreign-born individuals – whom the Department of Homeland Security charges with violating immigration law – should be ordered removed from the United States or should be granted relief from removal and be permitted to remain in this country. The Board of Immigration Appeals primarily reviews appeals of decisions by immigration judges. EOIR’s Office of the Chief Administrative Hearing Officer adjudicates immigration-related employment cases. EOIR is committed to ensuring fairness in all of the cases it adjudicates.
Erie Sisters Charged in Fraud SchemeRead the Press Release
ERIE, Pa. - Two residents of Erie, Pennsylvania, have been indicted by a federal grand jury in Erie on charges of conspiracy to defraud the government, theft of government property, aggravated identity theft and false claims against the United States, United States Attorney David J. Hickton announced today.
The twenty-nine-count indictment named Chamere Henderson, 35 and Chamell Henderson, 35, as defendants.
According to the indictment presented to the court, between February 2012 and March 2013, Chamere Henderson filed three fraudulent tax returns by stealing the identities of individuals. The refunds from the tax returns were wired into a bank account to which her sister, Chamell Henderson, had access. Chamell Henderson then removed the refunds from the account in cash. The indictment also alleges that Chamere Henderson filed numerous other false federal tax returns for taxpayers who were unaware that Chamere Henderson had included false information on their returns.
The law provides for a maximum total sentence of 96 years in prison, a fine of $7,250,000, or both for Chamere Henderson and a maximum total sentence of 20 years in prison, a fine of $500,000, or both for Chamell Henderson. 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 Christian A. Trabold is prosecuting this case on behalf of the government.
The Internal Revenue Service, Criminal Investigation, 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.
East Hartford Man Sentenced to 7 Years in Federal Prison for Distributing HeroinRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ORLANDO TIRADO, 30, of East Hartford, was sentenced today by U.S. District Judge Vanessa L. Bryant in Hartford to 84 months of imprisonment, followed by five years of supervised release, for distributing heroin.
According to court documents and statements made in court, this matter stems from a Drug Enforcement Administration Hartford Task Force investigation into a drug trafficking organization that distributed large quantities of heroin in the Hartford area.
On June 4, 2014, investigators conducted a motor vehicle stop of TIRADO and, during a consent search of his car, discovered $5200 in cash. On November 27, 2014, TIRADO attempted to flee from Hartford Police officers who were investigating a domestic assault. During the foot chase, investigators observed TIRADO throwing six brick-sized packages, which were seized and found to contain a total of 3,003 bags of heroin. TIRADO was arrested at that time and charged with state narcotics offenses.
In May 2015, while he was on pre-trial release in his state case, court-authorized wiretaps revealed that TIRADO and several associates were working together to sell narcotics. On May 13, 2015, one of TIRADO’s associates traveled from Hartford to New York City where law enforcement officers conducted a motor vehicle stop of the car and seized approximately $125,000 in cash.
TIRADO has been detained since his arrest on June 4, 2015. On June 2, 2016, he pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute 100 grams or more of heroin.
TIRADO’s criminal history includes felony convictions for narcotics trafficking offenses and assault and battery on a police officer.
Six other individuals were charged as a result of this investigation.
This matter has been investigated by the Drug Enforcement Administration’s Hartford Task Force, which includes participants from the Bristol, East Hartford, Hartford, Manchester, New Britain, Wethersfield and Willimantic Police Departments, with the assistance of the Connecticut State Police. The case is being prosecuted by Assistant U.S. Attorney Geoffrey M. Stone.
Director of All About Giving, Inc. Charged with Conspiracy and FraudRead the Press Release
LaShane Hayes, 43, of La Vergne, Tennessee, was charged in a criminal information today with conspiracy and wire fraud in relation to her role as the director of All About Giving, Inc., a sponsor agency in the United States Department of Agriculture’s Child and Adult Care Feeding Program (CACFP), announced David Rivera, United States Attorney for the Middle District of Tennessee.
The CACFP was created to reimburse child care providers for meals served to low-income children and other qualifying individuals. The program is funded by the USDA and administered in Tennessee by the Tennessee Department of Human Services. Program sponsor organizations were responsible for, among other things, enlisting child care providers into the program, communicating the total amount of reimbursement funds the providers were entitled to receive each month to the Tennessee Department of Human Services and distributing reimbursement funds to these child care providers.
The charging document alleges that Hayes, as a program sponsor, and her co-conspirators defrauded the program in a number of ways, including by overstating the number of All About Giving providers who actually furnished meals to children and by overstating the number of children who received meals from All About Giving providers in order to receive more program funds from the Tennessee Department of Human Services. The total amount of CACFP funds provided to All About Giving between February 2015 and July 2016 by the Tennessee Department of Human Services was $2,198,647.93.
If convicted, Hayes faces up to 20 years in prison and a fine of up to $250,000. She also faces forfeiture of the proceeds of her offenses.
Dental Office Manager Convicted of Fraudulently Obtaining over 100,000 Hydrocodone PillsRead the Press Release
NEWPORT NEWS, Va. – Donna Byrd Talley, 54, of Yorktown, was convicted yesterday by a federal jury on charges of acquiring or obtaining a controlled substance, possession with intent to distribute a controlled substance, and mail fraud.
According to court records and evidence presented at trial, Talley worked as a long-time office manager for Dr. Steven Becker, a Hampton dentist. Talley had control over Dr. Becker’s bank accounts and was responsible for all office administration. From 2002 through 2011, Talley used Dr. Becker’s DEA license to fraudulently obtain over 100,000 pills of hydrocodone from two dental supply companies. Talley distributed the hydrocodone to her husband and others and used it to feed her own addiction. In 2011, Talley made various cash deposits to bank accounts she owned or controlled in amounts over $7,000. On Aug. 18, 2011, investigators with the Virginia Department of Health Professions and the Virginia State Police interviewed Talley, who admitted to ordering hydrocodone. Later that same day, an investigator recovered a pill bottle containing hydrocodone from Talley’s residence, matching shipments of hydrocodone ordered by Talley and received by Dr. Becker’s office two days earlier.
Talley faces a maximum penalty of 10 years in prison when sentenced on Feb. 22, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of Talley will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division; and Ruth A. Carter, Diversion Program Manager (DEA), made the announcement after the verdict was accepted by U.S. District Judge Mark S. Davis. Assistant U.S. Attorneys Brian J. Samuels and Megan M. Cowles are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:16-cr-21.
Columbia, Kingdom City Men Sentenced for Drug-trafficking ConspiracyRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that two co-defendants have been sentenced in federal court for their roles in a conspiracy to distribute crack cocaine and powder cocaine in Boone County, Mo.
Travis Dewayne Dennis, 33, of Columbia, Mo., and Ronnie Lee Gillette, 55, of Kingdom City, Mo., and were sentenced in separate appearances before U.S. District Judge Stephen R. Bough on Tuesday, Nov. 8, 2016. Dennis was sentenced to five years in federal prison without parole. Gillette was sentenced to three years and four months in federal prison without parole.
On April 8, 2016, Dennis pleaded guilty to his role in the conspiracy to distribute crack cocaine. According to court documents, Dennis sold a total of 63.94 grams of crack cocaine to a confidential informant on five separate occasions. Dennis distributed crack cocaine that was supplied to him by co-defendant Malcolm Desean Redmon, also known as “Harp,” 33, of Columbia.
Redmon was sentenced on Sept. 29, 2016, to 24 years and four months in federal prison without parole. Redmon pleaded guilty to participating in a conspiracy to distribute five kilograms or more of powder cocaine and crack cocaine in Boone County from November 2011 to August 2014.
According to court documents, Redmon – the leader of the criminal conspiracy – and those working for him received a total of four kilograms of powder cocaine over the course of the conspiracy. During the investigation, law enforcement purchased 216.78 grams of crack cocaine and 46.04 grams of powder cocaine from members of the conspiracy. Law enforcement also seized 55.5 grams of crack cocaine and 93.63 grams of powder cocaine. The interception of telephone calls and statements made by co-defendants reflected a substantial number of additional transactions between members of the conspiracy. Court documents also cite Redmon’s involvement in numerous shooting incidents and his history of criminal activity, including violent crimes and drug use.
On April 22, 2016, Gillette pleaded guilty to participating in a conspiracy to distribute cocaine and to using a telephone to facilitate a drug-trafficking crime. According to court documents, Gillette was a trusted lieutenant who worked for co-defendant Kenneth Scott, Sr., 48, of Fulton, Mo.
Scott, who was sentenced on Sept. 29, 2016, to 10 years in federal prison without parole, pleaded guilty to his role in the drug-trafficking conspiracy, to being a felon in possession of firearms and to money laundering. Scott admitted that he was a major distributor of cocaine to various persons in the mid-Missouri area, including Columbia and Fulton. Scott was responsible for distributing more than six kilograms of cocaine, some of which had been converted into many pounds of crack cocaine.
Gillette and Dennis are among 14 defendants in this case who have been sentenced; 12 defendants have pleaded guilty and await sentencing.
This case is being prosecuted by Supervisory Assistant U.S. Attorney Michael S. Oliver. It was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, IRS-Criminal Investigation, the Columbia, Mo., Police Department, the Boone County, Mo., Sheriff’s Department, the U.S. Marshal’s Service, MUSTANG (the Mid-Missouri Unified Strike Team and Narcotics Group), the Drug Enforcement Administration and the Boone County, Mo., Prosecuting Attorney’s Office.
Clear Brook Man Pleads Guilty to False Labeling of Animal Blood ExportsRead the Press Release
ALEXANDRIA, Va. – Phillip Lloyd, 57, of Clear Brook, pleaded guilty yesterday to making and submitting false labels for animal blood that was transported internationally.
According to the statement of facts filed with the plea agreement, Lloyd was the owner and manager of Biochemed Services, Inc., a broker of human blood and animal blood products based in Winchester. Biochemed would receive orders from biomedical research companies for specific quantities of human blood, animal blood and products, and would package and export products from the United States. To evade enforcement by the U.S. Fish and Wildlife Service, employees of Biochemed shipped animal blood products with documents that falsely described the contents of the packages as “human” blood products. The actual labels accurately describing the blood shipments as “animal” blood products would be sent in separate FedEx envelopes that would not be inspected by Fish and Wildlife Service or other law enforcement officials.
According to the statement of facts, from in or about January 2014 to in or about May 2016, Biochemed packaged and shipped internationally, products including blood of squirrel monkeys and other primates protected by the Convention on International Trade in Endangered Species of Wild Fauna and Flora (“CITES”). CITES is an international agreement that provides protection to fish, wildlife and plant populations that are or could be harmed as a result of trade and restricts the international trade and transport of species that are threatened with extinction.
According to the statement of facts, on Jan. 23, 2014, in response to a request for squirrel monkey blood for shipment to a company in Canada known as “Tropicus Research,” Lloyd emailed the customer to confirm shipment with human on the labels, stating the squirrel monkey labels should arrive at the same time in a FedEx letter package. Lloyd then engaged in a telephone conversation about the shipment of monkey blood with an individual claiming to be an employee of Tropicus Research, but who was an employee of the U.S. Fish and Wildlife Service acting in an undercover capacity. On multiple occasions in February 2014, Lloyd caused FedEx to pick up and deliver to Tropicus Research packages of squirrel monkey blood, falsely labeled as “Human Blood,” accompanied by a commercial invoice indicating that the shipment contained human blood.
Lloyd faces a maximum penalty of five years in prison when sentenced on Jan. 27, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia, made the announcement after the plea was accepted by U.S. District Judge District Judge Gerald Bruce Lee. Assistant U.S. Attorney Gordon D. Kromberg is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-226.
Bushwick Drug Dealer Sentenced to Life in Prison for Orchestrating Two Contract MurdersRead the Press Release
Earlier today, Brooklyn drug trafficker Shaun Taylor, also known as “S-Dot,” was sentenced to ten life terms plus 50 years in prison. Following a three-week jury trial, Taylor was convicted on September 8, 2014, of all charges including murder for hire, drug-related murder, narcotics trafficking conspiracy, and firearms offenses. The charges arose from the defendant’s participation in a decade-long narcotics trafficking operation in the Bushwick neighborhood of Brooklyn, which was responsible for distributing kilogram quantities of heroin, cocaine, and crack cocaine in Brooklyn, Queens, and Long Island. Taylor ordered two murders during the conspiracy, one of which resulted in the death of an unintended victim, whom Taylor’s hitman shot in a case of mistaken identity.
The sentence was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office, and James P. O’Neill, Commissioner, New York City Police Department.
The evidence at trial established that Taylor frequently recruited young men to settle scores on his behalf. When another drug dealer stole the cellular telephone Taylor used to conduct his narcotics business, he recruited Timothy Pinkney to murder him. On April 29, 2005, Taylor offered Pinkney $1,500 to carry out the hit, drove Pinkney to the scene, and mistakenly directed him to shoot Terrance Barnett, who was standing in front of a school in Bushwick. Barnett just happened to be visiting Brooklyn for the weekend and had no prior relationship with Taylor or Pinkney. Pinkney shot Barnett in the head and torso at close range, killing him. Pinkney subsequently pled guilty to his role in the murder and is currently serving a 23-year prison sentence.
Two years later, Taylor and a co-conspirator stole approximately five kilograms of cocaine that was shipped to Joseph Vargas. Fearing Vargas might retaliate, Taylor hired two young men to kill him. On June 20, 2007, Taylor drove with the men to point out Vargas, who was at a car wash on DeKalb Avenue in Bushwick. Taylor provided the murder weapon and left the scene. One of the men entered the carwash and shot Vargas and his brother. Vargas’s brother survived, but Vargas was killed.
“The defendant was responsible for two murders – one, another drug dealer, the other, an innocent bystander who tragically was in the wrong place at the wrong time – once again demonstrating the inextricable link between drug trafficking and wanton violence. Taylor will now spend the rest of his life behind bars for his depraved acts,” stated United States Attorney Capers. Mr. Capers extended his grateful appreciation to the Federal Bureau of Investigation and the New York City Police Department for their outstanding work in this case.
“Shaun Taylor has shown a disregard for human life by paying others to do his dirty work for him, all so he could maintain total control over his drug trade in Brooklyn. In his desire to seek revenge, an innocent man Terrance Barnett died for no reason. The FBI and our law enforcement partners will continue to work every day to stop the corrosive effects the drug trade has on our communities,” stated FBI Assistant Director-in-Charge Sweeney.
The sentence was imposed by Chief United States District Judge Dora L. Irizarry.
The government’s case is being handled by Assistant United States Attorneys Matthew Amatruda, David Pitluck, and Tali Farhadian.
The Defendant:
SHAUN TAYLOR
Age: 32
Brooklyn, NYE.D.N.Y. Docket No. 10-CR-268
Buffalo Man Sentenced on Wire Fraud and Tax EvasionRead 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 Salvatore Letizia, 40, of Buffalo, NY, who was convicted of wire fraud and tax evasion before U.S. District Judge Richard J. Arcara, was sentenced to 41 months in prison.
Assistant U.S. Attorney Frank T. Pimentel, who handled the case, stated that from 2005 until 2009, Letizia defrauded four individuals out of more than $360,000. The defendant made false representations to entice the victims to invest in fictional business ventures. Letizia took the invested funds and credit lines and used them for his personal benefit. In addition, the defendant failed to file any tax returns for the tax years 2005 through 2009 declaring the income that resulted from the fraudulent activity.
The sentencing is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen Niagara, and Special Agents of the Internal Revenue Service, Criminal Investigation Division, under the direction of Shantelle P. Kitchen, Special Agent in Charge.
Baltimore Man Sentenced to 10 Years in Federal Prison for a Series of Commercial RobberiesRead the Press Release
Baltimore, Maryland – U.S. District Judge Marvin J. Garbis sentenced Taft Redd, age 45, of Baltimore, Maryland, today to 10 years in federal prison, followed by 3 years of supervised release, for six commercial robberies committed between July 22 and August 18, 2015.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Gordon B. Johnson of the Federal Bureau of Investigation, Baltimore Field Office; Baltimore Police Commissioner Kevin Davis; and Baltimore City State’s Attorney Marilyn Mosby.
According to his plea agreement, in each robbery Redd entered the store, approached the register, displayed what appeared to be a black handgun, and demanded money. Redd stole cash from each store and occasionally took merchandise as well. Specifically, on July 22 and August 18, 2015 Redd robbed the same convenience store located in the 5200 block of Harford Road in Baltimore; on July 22 Redd robbed a shoe store located in the 3200 block of Greenmount Avenue in Baltimore; July 29 and August 12, 2015 Redd robbed the same shoe store located in the 3900 block of Erdman Avenue in Baltimore; and on August 16, 2015 Redd robbed a fast food restaurant in the 2000 block of N. Broadway in Baltimore.
When Redd was arrested on August 19, 2015, he was in possession of a black BB gun that was the same weapon seen by witnesses in the six robberies.
United States Attorney Rod J. Rosenstein commended the FBI, Baltimore Police Department, and Baltimore City State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Matthew C. Sullivan, who is prosecuting the case.
Asheville Area Cattle Farm and Owner Plead Guilty to Clean Water Act Violation for Discharging Cow Feces into French Broad RiverRead the Press Release
ASHEVILLE, N.C. – Crowell Farms, Inc. located in Asheville, and its owner pleaded guilty in federal court today to criminal violations of the Clean Water Act, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina.
U.S. Attorney Rose is joined in making today’s announcement by Special Agent in Charge Andy Castro of the U.S. Environmental Protection Agency, Criminal Investigation Division (EPA-CID), Atlanta Area Office, and Judy Billings, Special Agent in Charge of the State Bureau of Investigations’ Diversion and Environmental Crimes Unit (SBI/ DECU).
A criminal bill of information filed in U.S. District Court on October 4, 2016, charged Crowell Farms, Inc. (Crowell Farms) and Michael Alexander Crowell, 65, of Asheville, with one count of violation of the Clean Water Act, in connection with the discharging of cow feces into the French Broad River. According to filed documents and statements made in court, Crowell Farms is in the beef cattle farming business maintaining more than 150 cows and manages many acres of agricultural fields. In the annual course of its operations, Crowell Farms disposes of thousands of pounds of solid and liquid animal waste, which are considered pollutants under the Clean Water Act. Michael Crowell is the Operator Responsible-in-Charge (ORC) for the permitted waste disposal system at Crowell Farms. As the ORC, Michael Crowell is responsible for ensuring that animal waste is properly disposed into the farm’s waste management system, namely in solids waste lagoons.
Michael Crowell admitted in court today that from in or about November 2015 through at least December 2015, he had installed bypasses at the farm’s waste lagoons that were discharging liquid animal waste into a tributary of the French Broad River. Michael Crowell also admitted that he had trouble managing Crowell Farms’ waste management system and that he had installed the bypasses himself. Filed documents show that Michael Crowell previously told inspectors he was aware that he had done “the wrong thing.” Crowell Farms does not have a permit to discharge liquid waste to waters and it is only permitted to discharge it to an on-site land application system. State inspectors further discovered that Crowell Farms does not own the proper land application equipment.
In addition to pleading guilty to violating the Clean Water Act, Crowell Farms has also agreed: 1) to pay a fine of $40,000 (reduced by the $27,000 fine paid to the State of North Carolina), which will be directed to entities that safeguard the French Broad River and other environmental concerns in the Southeast; 2) to serve a probationary term of three years during which regulators and investigators can inspect their records and facilities without notice and without a warrant; and 3) to design and implement a compliance plan subject to approval by the EPA. At sentencing, Michael Crowell faces a maximum prison term of three years and an additional fine of $5,000 to $50,000. A sentencing date has not been set yet.
The Clean Water Act is a federal law enacted to prevent, reduce and eliminate pollution, and to restore and maintain the chemical, physical, and biological quality of the Nation’s waters for the protection and propagation of fish and aquatic life and wildlife, for recreational purposes, and for the use of such waters for public drinking water, agricultural, and industrial purposes. The French Broad River supplies drinking water to more than one million people and is frequently used for recreational water activities, such as swimming and kayaking. It is also protected because it supports secondary recreation, including fishing, fish consumption, and agriculture.
The investigation was led by the EPA’s Criminal Investigation Division and SBI’s DECU. Assistant United States Attorney Steven R. Kaufman of the U.S. Attorney’s Office in Charlotte is prosecuting the case.
Alexandria woman pleads guilty to illegally using clinic credit cards to steal $119,000Read the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced that an Alexandria woman pleaded guilty Monday to using an Alexandria clinic’s credit cards to make unauthorized purchases of $119,000.
Alaina Stansell, 35, of Alexandria, pleaded guilty before U.S. District Judge Dee D. Drell to one count of wire fraud. According to the guilty plea, Stansell worked in a urology clinic in Alexandria where she had access to the office’s credit cards. She used the credit cards from December 1, 2013 to March 30, 2015 to make unauthorized purchases and expenditures totaling approximately $119,000.
Stansell faces up to 30 years in prison, five years of supervised release, restitution and a $250,000 fine. A sentencing date of February 3, 2017 was set.
The U.S. Secret Service conducted the investigation. Assistant U.S. Attorney Earl M. Campbell is prosecuting the case.
Albuquerque Man Sentenced to 12 Years for Discharging Firearm During Attempted Robbery of RestaurantRead the Press Release
ALBUQUERQUE – Peter Pagan, 23, of Albuquerque, N.M., was sentenced yesterday in federal court to 147 months in prison for violating the Hobbs Act by attempting to rob an Albuquerque-area fast food restaurant and discharging a firearm during the attempted robbery. Pagan will be on supervised release for three years following his prison sentence.
Pagan was charged by criminal complaint in Oct. 2015, with discharging a firearm while attempting to rob the Blake’s Lotaburger located at 6215 San Antonio Dr. NE in Albuquerque on Jan. 27, 2015. According to the complaint, Pagan entered the restaurant, pointed a firearm at employees, and demanded money. When the employees were unable to open the cash register, Pagan shot a round of ammunition into the ceiling before running out of the restaurant. When a customer attempted to chase him down, Pagan fired nine rounds into the customer’s vehicle.
Pagan was indicted on Nov. 17, 2015, and was charged with violating the Hobbs Act and discharging a firearm during a crime of violence. According to the indictment, Pagan committed the crimes on Jan. 27, 2015, in Bernalillo County, N.M.
On Aug. 8, 2016, Pagan pled guilty to the indictment. In entering the guilty plea, Pagan admitted that on Jan. 27, 2015, he entered a Blake’s Lotaburger armed with a loaded handgun and demanded money. Pagan further admitted firing a round into the ceiling of the restaurant when employees were unable to open the cash register.
State charges against Pagan were dismissed in favor of federal prosecution.
This case was investigated by the Albuquerque office of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Albuquerque Police Department with assistance from the 2nd Judicial District Attorney’s Office. Assistant U.S. Attorneys Paul H. Spiers and Rumaldo R. Armijo prosecuted the case.
This case is being prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible. In recognition that New Mexico’s violent crime rates, on a per capita basis, are amongst the highest in the nation, New Mexico’s law enforcement community has come together to is collaborating the initiative is significantly exceed the national average.
Alabama Man Sentenced to Prison for Participation in Stolen Identity Refund Fraud SchemeRead the Press Release
A Montgomery County, Alabama resident was sentenced to 28 months in prison for his role in a stolen identity refund fraud scheme, announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division, and U.S. Attorney George L. Beck Jr. of the Middle District of Alabama.
Lambert Derran Smothers aka Main or Mane, 25, admitted that he participated in a conspiracy which used stolen personal identifying information including names, dates of birth and social security numbers to file more than 100 fraudulent income tax returns relating to tax years 2010, 2011 and 2012. On the returns, Smothers and his co-conspirators fraudulently claimed at least $157,292 in income tax refunds.
“Stolen identity refund crimes cause untold damage and hardship to the individual victims and drain the U.S. Treasury,” said Principal Deputy Assistant Attorney General Ciraolo. “Individuals who engage in this criminal conduct will be prosecuted, and will face prison terms and monetary penalties.”
“Protecting tax payer dollars is a priority for my office,” said U.S. Attorney Beck. “Identity theft and tax fraud affects too many people in our communities and we must use all available resources under the law to destroy it. I want to thank the IRS Criminal Investigations and the U.S. Secret Service for identifying and shutting down this criminal scheme.”
“Stealing from the government is not a way to earn a living,” said Special Agent in Charge Veronica Hyman-Pillot for the Internal Revenue Service-Criminal Investigation (IRS-CI). “Lambert Smothers and his associates victimized many taxpayers in their attempt to make quick money. Today’s sentencing should emphasize the message that IRS-CI will continue to put forth every effort to identify, investigate, and recommend prosecution on individuals who commit refund fraud.”
Smothers pleaded guilty in July to conspiring to defraud the United States, theft of government money and aggravated identity theft. In addition to the term of prison imposed, Smothers was also ordered to serve three years of supervised release and to pay $81,792.41 in restitution to the IRS.
Principal Deputy Assistant Attorney General Ciraolo and U.S. Attorney Beck commended special agents of IRS-CI and the U.S. Secret Service, who conducted the investigation, and Trial Attorneys Gregory P. Bailey and Robert J. Boudreau of the Tax Division and Assistant U.S. Attorney Jonathan Ross of the Middle District of Alabama, who prosecuted this case.
Additional information about the Tax Division and its enforcement efforts may be found on the Division’s website.
A Home Town HeroRead the Press Release
SALT LAKE CITY-- In September, I had the honor of attending a West Valley City Council meeting to recognize Officer Cody Brotherson and his colleagues for their outstanding police work in swiftly and safely capturing an armed and dangerous gang member. When I learned Sunday of Officer Brotherson’s tragic death, I remembered shaking his hand and thinking that this dedicated young man had all the qualities to be a hero in his home town of West Valley City. And he was.
In the early hours of Sunday morning, Officer Brotherson was once again protecting our community by laying tire spikes to stop a stolen car when he was struck and killed by the fleeing suspects. There is no greater sacrifice a person can make than to give his own life to keep our community safe.
While the rest of us are sleeping, men and women in law enforcement are on the streets risking their lives. We ask our law enforcement officers to work long hours with little pay, to subject themselves to intense public scrutiny, and to put themselves in harm’s way. We ask officers and their families to sacrifice their own safety and security for our wellbeing. It is too much to ask of any citizen, yet these brave men and women do it every single day.
Law enforcement professionals like Officer Brotherson are not in it for the accolades, and they rarely get them. I consider it a great honor to have had the opportunity to meet Officer Brotherson and to present him with an award for his service to our community. So young and so heroic, Officer Brotherson made a huge impact for the good of our community before his premature departure. My thoughts and prayers are with Officer Brotherson’s family and friends, and with my dear colleagues at the West Valley City Police Department, during this very difficult time.
Tuesday 8 November 2016
“Coyote” se Declara Culpable de Conspiración para Estafar a Inmigrantes que Buscaban Ingresar a EE.UU. y a Sus Parientes en Estados UnidosRead the Press Release
FRESNO, California. —Un hombre que anteriormente se hacía pasar por traficante de inmigrantes (conocido también como “coyote”) se declaró culpable en el día de hoy de perpetrar un complot que buscaba privar de la libertad a ciudadanos mexicanos que buscaban ingresar a EE.UU. sin contar con la documentación necesaria, y retenerlos a fin de obligar a sus parientes que ya eran residentes en EE.UU. a que pagaran dinero a cambio de su liberación, tal como lo anunciara el Fiscal (encargado) de Estados Unidos, Phillip A. Talbert.
Martin Carranza Sánchez, de 45 años de edad y oriundo de México, se declaró culpable en el día de hoy de conspirar para cometer estafa por vía telefónica. De acuerdo con su convenio declaratorio, entre enero de 2010 y el 21 de enero de 2016, Carranza Sánchez se hacía pasar por traficante de inmigrantes indocumentados y prometía de manera falsa que entregaría a los inmigrantes en Estados Unidos luego de que le pagaran una suma de dinero. Carranza Sánchez les ordenaba a los residentes en EE.UU. que enviaran el dinero mediante transferencia electrónica a varias cuentas bancarias ubicadas en el Distrito Este de California, dineros que él y sus cómplices recogían en última instancia.
Según documentos radicados en el tribunal, Carranza Sánchez les indicaba a los inmigrantes que se dirigieran a cierto lugar en México en donde sus cómplices los agarraban y detenían en contra de su voluntad, con el fin de lograr que se les pagara. Los cómplices llamaban por teléfono a los residentes en EE.UU., informándoles que los inmigrantes serían entregados pronto en Estados Unidos, o que ya habían logrado cruzar la frontera con éxito, indicándoles a los residentes en EE.UU. que efectuaran la transferencia electrónica del pago. En múltiples ocasiones, Carranza Sánchez y sus cómplices amenazaron con causarles daño físico a los inmigrantes a menos que los residentes en EE.UU. pagaran de forma inmediata.
De acuerdo con el convenio declaratorio, Carranza Sánchez nunca tuvo la intención de facilitarles a estos inmigrantes su ingreso a Estados Unidos sin ser detectados. En muchos casos, una vez que los parientes hubiesen transferido la suma requerida, Carranza Sánchez les indicaba a los inmigrantes que cruzaran la frontera y la Patrulla Fronteriza de Estados Unidos los aprehendía de inmediato.
La investigación dio cuenta de que Carranza Sánchez y sus cómplices estafaron a los residentes de EE.UU. en cuantía de unos $95.000 dólares como resultado de su complot. El convenio declaratorio le obliga a restituirles a las víctimas de su delito esa misma suma de dinero.
Este caso es el resultado de una investigación llevada a cabo por la sección de investigaciones del Departamento de Seguridad Interna (HSI, por sus siglas en inglés) adscrita al Departamento de Inmigración y Aduanas de EE.UU. (ICE, por sus siglas en inglés). La Fiscal Auxiliar de Estados Unidos Angela L. Scott es quien adelanta el caso.
Se ha programado la imposición de la condena a Carranza Sánchez para el 6 de febrero de 2017 a las 10:00 a.m. por parte del Juez de Distrito de EE.UU. Dale A. Drozd. Carranza Sánchez se enfrenta a una pena máxima por ley de 20 años de prisión. Sin embargo, la condena final será determinada a juicio del tribunal luego de tomar en cuenta algunos de los factores estatutarios, así como las Pautas Condenatorias Federales, las cuales toman en cuenta varios.
Two Florida Men Sentenced to over Ten Years in Prison for Multi-State for Biofuel Fraud SchemeRead the Press Release
Yesterday, Thomas Davanzo, of Estero, Florida, and Robert Fedyna, of Naples, Florida, were sentenced to 121 months and 135 months in prison, respectively, for their participation in a multi-state scheme to defraud biofuel buyers and U.S. taxpayers by fraudulently selling biofuelcredits and fraudulently claiming tax credits, announced Assistant Attorney General John C. Cruden of the Justice Department’s Environment and Natural Resources Division and U.S. Attorney A. Lee Bentley III of the Middle District of Florida. Both defendants were also ordered to forfeit ill-gotten gains from the conspiracy of over $46 million and other items to the government, including gold coins, jewelry and Rolex watches, thoroughbred horses, vehicles and properties.
Davanzo and Fedyna operated several shell companies that were used to facilitate the scheme. As part of the scheme, Davanzo and Fedyna operated entities that purported to purchase renewable fuel, on which credits had been claimed and which was ineligible for additional credits, produced by their co-conspirators at Gen-X Energy Group (Gen-X), headquartered in Pasco, Washington, and its subsidiary, Southern Resources and Commodities (SRC), located in Dublin, Georgia. They then used a series of false transactions to transform the fuel back into feedstock needed for the production of renewable fuel, and sold it back to Gen-X or SRC, allowing credits to be claimed again. This cycle was repeated multiple times.
“In their pursuit of personal gain, the defendants perpetrated a multi-state conspiracy that defrauded and undermined a federal program intended to further the energy independence of our nation,” said Assistant Attorney General Cruden. “Today’s sentence is a just punishment for these serious crimes against the American people.”
“This case shows that EPA is committed to eliminating fraud in the renewable fuels market and ensuring a level playing field for businesses that play by the rules,” said Assistant Administrator Cynthia Giles for EPA’s Office of Enforcement and Compliance Assurance. “The sentences handed down show the serious nature of these crimes and that EPA will continue to hold criminals accountable.”
In addition, both Davanzo and Fedyna laundered the proceeds of the scheme through various shell entities. Davanzo and Fedyna established bank accounts in the names of shell entities. Funds were cycled through these shell companies’ bank accounts to perpetuate the fraud scheme and conceal its proceeds.
Davanzo and Fedyna also directed and participated in the generation of false paperwork designed to create the façade that the renewable identification number (or RIN, a serial number used to track renewable fuel credits) created and claimed by co-conspirators were legitimate. The paperwork included false invoices from Gen-X or SRC to shell entities, which purported to show sales of renewable fuel, false invoices from shell entities to Gen-X and SRC, which purported to show the purchase of feedstock and false bills of lading, which purported to show the transportation of fuel and feedstock by tanker truck.
From March 2013 to March 2014, the co-conspirators generated at least 60 million RINs that were based on fuel that was either never produced or was merely re-processed at the Gen-X or SRC facilities. The co-conspirators received at least $42 million from the sale of these fraudulent RINs to third parties. In addition, Gen-X received approximately $4,360,724.50 in false tax credits for this fuel.
This case was investigated by the U.S. Secret Service, the Environmental Protection Agency -Criminal Investigation Division, and the Internal Revenue Service-Criminal Investigation. It was prosecuted by Assistant United States Attorneys Sara C. Sweeney and Megan Kistler and Trial Attorney Adam Cullman of the Environment and Natural Resources Division of the Department of Justice.
Two Florida Men Sentenced to over Ten Years in Prison for Multi-State Biodiesel Fraud SchemeRead the Press Release
Fort Myers, FL — Yesterday, Thomas Davanzo, of Estero, Florida, and Robert Fedyna, of Naples, Florida, were sentenced to 121 months and 135 months in prison, respectively, for their participation in a multi-state scheme to defraud biodiesel buyers and U.S. taxpayers by fraudulently selling biodiesel credits and fraudulently claiming tax credits, announced Assistant Attorney General John C. Cruden of the Justice Department’s Environment and Natural Resources Division and U.S. Attorney A. Lee Bentley III of the Middle District of Florida. Both defendants were also ordered to forfeit ill-gotten gains from the conspiracy of over $46 million and other items to the government, including gold coins, jewelry and Rolex watches, thoroughbred horses, vehicles and properties.
Davanzo and Fedyna operated several shell companies that were used to facilitate the scheme. As part of the scheme, Davanzo and Fedyna operated entities that purported to purchase renewable fuel, on which credits had been claimed and which was ineligible for additional credits, produced by their co-conspirators at Gen-X Energy Group (Gen-X), headquartered in Pasco, Washington, and its subsidiary, Southern Resources and Commodities (SRC), located in Dublin, Georgia. They then used a series of false transactions to transform the fuel back into feedstock needed for the production of renewable fuel, and sold it back to Gen-X or SRC, allowing credits to be claimed again. This cycle was repeated multiple times.
“In their pursuit of personal gain, the defendants perpetrated a multi-state conspiracy that defrauded and undermined a federal program intended to further the energy independence of our nation,” said Assistant Attorney General Cruden. “Today’s sentence is a just punishment for these serious crimes against the American people.”
“We are proud to work with our federal law enforcement partners to identify and investigate individuals that manipulate and utilize federal government programs to line their pockets by fraud,” said Kim Lappin, IRS Criminal Investigation, Special Agent in Charge of the Tampa Field Office. “Today’s sentencings mark the successful result of an investigation that uncovered a complicated fraudulent scheme that generated tens of millions of dollars through false biodiesel tax credits. IRS-Criminal Investigation will continue to work with the United States Attorney’s Office to prosecute all those involved.”
In addition, both Davanzo and Fedyna laundered the proceeds of the scheme through various shell entities. Davanzo and Fedyna established bank accounts in the names of shell entities. Funds were cycled through these shell companies’ bank accounts to perpetuate the fraud scheme and conceal its proceeds.
Davanzo and Fedyna also directed and participated in the generation of false paperwork designed to create the façade that the renewable identification number (or RIN, a serial number used to track biodiesel credits) created and claimed by co-conspirators were legitimate. The paperwork included false invoices from Gen-X or SRC to shell entities, which purported to show sales of renewable fuel, false invoices from shell entities to Gen-X and SRC, which purported to show the purchase of feedstock and false bills of lading, which purported to show the transportation of fuel and feedstock by tanker truck.
From March 2013 to March 2014, the co-conspirators generated at least 60 million RINs that were based on fuel that was either never produced or was merely re-processed at the Gen-X or SRC facilities. The co-conspirators received at least $42 million from the sale of these fraudulent RINs to third parties. In addition, Gen-X received approximately $4,360,724.50 in false tax credits for this fuel.
This case was investigated by the U.S. Secret Service, the Environmental Protection Agency -Criminal Investigation Division, and the Internal Revenue Service-Criminal Investigation. It was prosecuted by Assistant United States Attorneys Sara C. Sweeney and Megan Kistler and Trial Attorney Adam Cullman of the Environment and Natural Resources Division of the Department of Justice.
Three Dubuque Men Sentenced to Federal Prison for Illegally Possessing GunsRead the Press Release
Camron Andrew Pete, Jr., 24, received a statutory maximum ten-year prison term after his April 25, 2016 guilty plea to possessing a firearm while an unlawful user of a controlled substance. At sentencing, Pete admitted he fired shots at an occupied residence in Dubuque in December 2015. Chief Judge Linda R. Reade of the United States District Court found Pete fired the shots, which penetrated the residence, with a high-capacity magazine. Pete also admitted he obstructed justice by attempting to tamper with a grand jury witness.
Reginald Darnell Shaw, Jr., 25, received a 46-month prison term after his April 28, 2016 guilty plea to possessing a firearm while an unlawful user of a controlled substance and following a misdemeanor conviction for a crime of domestic violence. At sentencing, Shaw admitted he came to Dubuque from Wisconsin to protect Pete and accompanied Pete to the Dubuque shooting with a loaded firearm.
Landon Nathanson-Love, 24, received a 57-month prison term after his April 25, 2016 guilty plea to possessing a firearm while an unlawful user of a controlled substance. At sentencing, Nathanson-Love admitted to selling Pete and Shaw the firearms that were later used in the shooting. Nathanson-Love had purchased the firearms by means of a fraudulently procured gun permit. Judge Reade found Nathanson-Love obstructed justice by working with a family member to delete a social media account and tampering with a grand jury witness. Judge Reade commended the courage of the witnesses in spite of the attempts to obstruct justice in the cases.
A special assessment of $100 was imposed in each case. All three defendants must also serve a three-year term of supervised release after their respective prison terms. There is no parole in the federal system. All three defendants are being held in the United States Marshal’s custody until they can be transported to a federal prison.
The cases were prosecuted by Assistant United States Attorney Tim Vavricek and investigated by the Dubuque Police Department and the Bureau of Alcohol, Tobacco, and Firearms.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 16-CR-1011-LRR.
Follow us on Twitter @USAO_NDIA.