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30 November 2016
Minneapolis Man Pleads Guilty to Hate Crime for Mailing Threatening Letter to Islamic CenterRead the Press Release
DANIEL GEORGE FISHER, 57, pleaded guilty today to a federal hate crime for writing and mailing a threatening letter to an Islamic Center. FISHER was charged with one count of obstructing the free exercise of religious beliefs.
The plea was announced by United States Attorney Andrew M. Luger; Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division; and Special Agent in Charge Richard T. Thornton of the FBI’s Minneapolis Division.
"Threatening to blow up a mosque is simply un-American," said U.S. Attorney Luger. "It is a bedrock principle of our country, enshrined in the First Amendment to the Constitution, that all people are free to practice their religion of choice. Tens of thousands of law-abiding Muslims do so in Minnesota. The U.S. Attorney's Office and FBI will not allow any resident of our state to have that most basic freedom jeopardized by the threat of violence."
“America protects the free exercise of religion for all people in every community,” said Principal Deputy Assistant Attorney General Gupta. “Threats of violence that target religious communities violate federal law; corrode the ideals of our democracy; and threaten the foundation of an inclusive, free and open society. The Justice Department will continue to vigorously prosecute hate crimes that target people because of where they worship.”
“Today’s guilty plea affirms that hate crimes directed at our communities based on their religion will not be tolerated,” said Special Agent in Charge Thornton. “We will continue to aggressively investigate and bring to justice those who threaten violence against our citizens who choose to exercise their religious freedom as protected by our Constitution.”
According to the defendant’s guilty plea, on September 30, 2015, the Tawfiq Islamic Center received an anonymous handwritten letter, which threatened to “blow up your building with all you immigrants in it.” The letter also included profanities, racial and ethnic slurs, and other derogatory commentary about the religious and cultural practices of the members of the Tawfiq Islamic Center.
According to the defendant’s guilty plea, FBI Special Agents interviewed FISHER on June 14, 2016. FISHER reported that he was angry that the Tawfiq Islamic Center selected Minnehaha Avenue for its new location and he wanted the Center to build somewhere else. FISHER further reported that he had become “increasingly angry with Muslims since 9/11.” FISHER confessed to writing the letter and mailing it to Tawfiq Islamic Center with the intent to threaten and scare members of the Tawfiq Islamic Center.
This case is the result of an investigation conducted by the FBI.
This case is being prosecuted by Assistant U.S. Attorney Angela Munoz-Kaphing and Trial Attorney Olimpia Michel of the Civil Rights Division’s Criminal Section.
Defendant Information:
DANIEL GEORGE FISHER, 57
No known address
Convicted:
- Obstruction of Persons in the Free Exercise of Religious Beliefs, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Milford Psychiatrist Pleads Guilty to Illegal Drug Distribution and Health Care Fraud OffensesRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that LJUDMIL KLJUSEV, M.D., 52, of Fairfield, pleaded guilty today before U.S. District Judge Alvin W. Thompson in Hartford to distributing narcotics outside of the scope of professional practice, and health care fraud.
According to court documents and statements made in court, KLJUSEV, who operated a psychiatry practice in Milford, was a high-volume prescriber of Adderall and Xanax to patients, many of whom paid for office visits and prescriptions in cash.
Adderall, which is classified as a Schedule II drug by the DEA, is the brand name for a drug containing a combination of amphetamine and dextroamphetamine, both of which are central nervous system stimulants. This combination of drugs is used to treat narcolepsy and attention deficit hyperactivity disorder (“ADHD”). Xanax, which is classified as a Schedule IV drug by the DEA, is a brand name for a drug containing Alprazolam, a benzodiazepine drug. Alprazolam is commonly used to treat anxiety disorders or panic disorders.
The investigation, which included the use of confidential witnesses and an undercover officer posing as patients, revealed that KLJUSEV prescribed the drugs without a full medical examination of the patient, provided prescriptions without confirming conditions that would medically require treatment using these drugs and dispensed prescriptions in exchange for cash to patients who display substance abuse and addiction behaviors. KLJUSEV also directed non-physician employees to write prescriptions signed by KLJUSEV when he was out of the country.
In 2014 and 2015, KLJUSEV improperly billed private health insurers approximately $76,983 for medical services rendered when he was out of the country.
“This doctor sold controlled substances out of his office for cash, like a common drug dealer,” said U.S. Attorney Daly. “We are finding with increasing frequency that the types of pills he distributed are contributing to drug overdose deaths. They are incredibly dangerous if taken inappropriately and particularly toxic if combined with an opioid. We in law enforcement are committed to prosecuting medical professionals who recklessly and illegally put these and other prescription pills on the street. I thank our partners in this ongoing battle: The DEA and talented members of the Tactical Diversion Squad, as well as the Milford Police Department.”
“The DEA is committed to enforcing the Controlled Substance Act (CSA) by ensuring that all registrants abide by DEA’s prescribing regulations,” said DEA Special Agent in Charge Michael J. Ferguson. “Failure to do so increases the potential for diversion and jeopardizes the public health and safety. DEA pledges to work with our law enforcement and regulatory partners to ensure that these rules and regulations are followed.”
KLJUSEV has been detained since his arrest on November 12, 2015.
KLJUZEV pleaded guilty to one count of conspiracy to possess with intent to distribute narcotics, which carries a maximum term of imprisonment of 20 years, and one count of health care fraud, which carries a maximum term of imprisonment of 10 years.
In a binding plea agreement, if accepted by the court, the parties have agreed that a sentence between 26 and 77 months of imprisonment is appropriate in this case. KLJUSEV also has agreed to the forfeiture of property located at 227 Naugatuck Avenue in Milford, where his practice was based, as well as $173,095.20 in cash that was seized from his office on the day of his arrest. He also has agreed to forfeit an additional $117,431.13 contained in his business checking account, and to pay restitution in the amount of $76,983.
Judge Thompson scheduled sentencing for February 22, 2017.
This investigation has been conducted by the DEA’s New Haven Tactical Diversion Squad, Federal Bureau of Investigation and Milford Police Department. The DEA Tactical Diversion Squad includes officers from the Bristol, Greenwich, Hamden, Milford, New Haven, Shelton, Vernon and Wilton Police Departments. This case is being prosecuted by Assistant U.S. Attorneys Sarah Karwan and Avi Perry.
McAlester Man Pleads Guilty to Drug Conspiracy, Assaulting an Officer of the United StatesRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that CODY LEE MCCLENDON III, age 36, of McAlester, Oklahoma, pled guilty to DRUG CONSPIRACY, in violation of Title 21, United States Code, Sections 846, 841(a)(1), and 841(b)(1)(A), punishable by not less than 10 years and not more than life imprisonment, and up to a $10,000,000.00 fine or both; and to ASSAULTING AN OFFICER OF THE UNITED STATES, in violation of Title 18, United States Code, Section 111(a)(1), punishable by not more than 8 years imprisonment and up to a $250,000.00 fine or both.
The Superseding Indictment alleged that from beginning in or about the end of 2013, the exact date being unknown to the Grand Jury, and continuing until on or about January 27, 2016, within the Eastern District of Oklahoma and elsewhere, the Defendants did knowingly and intentionally conspire, confederate and agree with each other, and with others known and unknown to the Grand Jury to Possess with Intent to Distribute and to Distribute 500 grams or more of a mixture or substance containing a detectable amount of Methamphetamine, a Schedule II Controlled Substance.
The Information further alleged that on June 22, 2016, the Defendant forcibly assaulted a Deputy United States Marshal, while engaged in the performance of his official duties, which resulted in physical contact with the Deputy Marshal.
The Investigation revealed that Cody McClendon III, a/k/a Cody-Mac, an Indian Brother Hood (IBH) gang member, while an inmate with the Oklahoma Department of Corrections in McAlester, Oklahoma, was utilizing a contraband cellular phone that he kept hidden on his person and inside his prison cell to facilitate the sale and distribution of methamphetamine. McClendon was doing this by using the cellular phone to communicate with co-conspirators via audio phone calls, text messages, and by communicating on the social media website Facebook. While detained on federal charges pending trial, McClendon forcibly assaulted a United States Deputy Marshal by spitting on him.
The charges arose from a joint investigation entitled “Home of the Brave” coordinated by the Organized Crime Drug Enforcement Task Force (OCDETF) of the Eastern District of Oklahoma. OCDETF is an initiative led and coordinated by the Office of the United States Attorney. The agencies involved in the investigation were the Oklahoma Bureau of Narcotics, the McAlester Police Department, the Tahlequah Police Department, the Muskogee Police Department, the Cherokee County Sheriff’s Department, Districts 13, 18, 25 and 27 District Attorney’s Drug Task Forces and Violent Crime Task Forces, the Muskogee County District Attorney’s Office, the Seminole Nation Lighthorse Police Department, the Oklahoma Department of Corrections, the Bureau of Indian Affairs and the McAlester and Tulsa Offices of the Drug Enforcement Administration.
The Honorable Kimberly E. West, Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the plea and ordered the completion of a presentence investigation report. The defendant will remain in custody pending a sentencing hearing.
Assistant United States Attorney Shannon Henson represented the United States.
Mass. Resident Allegedly Traveled to RI to Engage in Illicit Sex with a MinorRead the Press Release
PROVIDENCE – Alexander Viola, 28, of Shrewsbury, MA., was arraigned on Tuesday in U.S. District Court in Providence on a charge of travelling across state lines with the intent to engage in illicit sexual conduct.
It is alleged that Viola traveled to Rhode Island in July with the intent to engage in illicit sexual conduct with a person he believed to be a 15-year-old female he had been communicating with on the Internet. The person he allegedly solicited was actually a Rhode Island State Police trooper assigned to the Internet Crimes Against Children (ICAC) Task Force.
Alexander Viola’s indictment and arraignment are announced by United States Attorney Peter F. Neronha; Colonel Ann C. Assumpico, Acting Superintendent of the Rhode Island State Police; and Matthew J. Etre, Special Agent in Charge of Homeland Security Investigations (HSI) for New England.
It is alleged that for about 10 days beginning in early July, Viola communicated online and by text message with a person he believed to be a 15-year-old girl. It is alleged that Viola turned the conversations to a sexual nature. On July 12, 2016, Viola allegedly traveled to Rhode Island from his Massachusetts residence with the intent to meet with the 15-year-old girl and to engage in sexual activity. Upon his arrival at a previously agreed upon location, Viola was arrested by members of the ICAC Task Force. He was released following an appearance in Rhode Island state court.
Viola, arrested on a federal arrest warrant on Tuesday by members of the ICAC Task Force and HSI agents, was released on unsecured bond with electronic monitoring following his arraignment before U.S. District Court Magistrate Judge Patricia A. Sullivan.
An indictment is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
The case is being prosecuted by Assistant U.S. Attorney John P. McAdams.
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Marion Man Sentenced to 20 Years on Child Sexual Exploitation ChargesRead the Press Release
A man who sexually exploited a child, distributed child pornography, and received child pornography was sentenced today to 20 years in federal prison.
Bryan King, age 46, of Marion, Iowa, received the sentence after an August 11, 2016 jury verdict finding him guilty of one count of sexual exploitation of a child, one count of distribution of child pornography, and one count of receipt of child pornography.
The evidence at trial showed that, in October 2014, King persuaded and attempted to persuade, induce, and entice a 15-year-old child to produce an image depicting sexually explicit conduct. The evidence also showed that King distributed this image and an image of another child to another person.
King was sentenced in Cedar Rapids by United States District Court Judge Leonard T. Strand. King was sentenced to 240 months’ imprisonment. A special assessment of $300 was imposed, King was ordered to pay a $10,000 fine, and he must also serve a 5-year term of supervised release. He must comply with all sex offender registration and public notification requirements.
This case was prosecuted by Assistant United States Attorney Mark Tremmel and was investigated by the Iowa Division of Criminal Investigation, the Douglas County, Nebraska, Sheriff’s Office, and the Federal Bureau of Investigation.
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.”
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 15-87.
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MS-13 Member Pleads Guilty in Connection with Assaulting Gang Rival and Selling CocaineRead the Press Release
BOSTON – A member of La Mara Salvatrucha, or “MS-13,” pleaded guilty on Monday, Nov. 28, 2016, in connection with attempting to murder a gang rival in Chelsea in 2015 and distributing cocaine.
Jose Hernandez-Miguel, aka “Muerto,” 31, of Chelsea, pleaded guilty to conspiracy to conduct enterprise affairs through a pattern of racketeering activity (a/k/a racketeering conspiracy), conspiracy to distribute five kilograms or more of cocaine, and conspiracy to distribute cocaine and cocaine base. U.S. District Court Judge F. Dennis Saylor, IV scheduled sentencing for Feb. 21, 2017.
After a three-year investigation, Hernandez-Miguel was one of 56 people named in a January 2016 superseding indictment targeting the criminal activities of alleged leaders, members, and associates of MS-13 in Massachusetts.
According to court documents, Hernandez-Miguel was identified as a member of MS-13’s Eastside Loco Salvatrucha (ESLS) clique. As an ESLS member, Hernandez-Miguel participated in violent ceremonies inducting new gang members, known as “jumping in,” and paid dues to fund MS-13 activities in Massachusetts and in El Salvador. As part of his plea agreement, Hernandez-Miguel admitted that he and other MS-13 members attempted to murder a gang rival by stabbing him near Highland Park in Chelsea on May 12, 2015. Hernandez-Miguel also admitted that he conspired to distribute five kilograms or more of cocaine, and conspired with other Chelsea-based drug traffickers to distribute cocaine and cocaine base to a cooperating witness.
An August 2016 superseding indictment brings the total number of defendants in the case to 61. Hernandez-Miguel is the seventh defendant to plead guilty.
The RICO conspiracy charge provides a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000. The conspiracy to distribute five kilograms or more of cocaine charge provides for a mandatory minimum sentence of 10 years and no greater than life in prison, a minimum of five years of supervised release and a fine of $10 million. The conspiracy to distribute cocaine and cocaine base charge provides for a sentence of no greater than 20 years in prison; three years of supervised release and a fine of $1 million. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Matthew Etre, Special Agent in Charge of Homeland Security Investigations in Boston; Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police; Thomas Turco, Commissioner of the Massachusetts Department of Corrections; Essex County Sheriff Frank G. Cousins, Jr.; Suffolk County Sheriff Steven W. Tompkins; Suffolk County District Attorney Daniel F. Conley; Middlesex County District Attorney Marian T. Ryan; Essex County District Attorney Jonathan Blodgett; Boston Police Commissioner William Evans; Chief Brian A. Kyes of the Chelsea Police Department; Chief Steven A. Mazzie of the Everett Police Department; Chief Kevin F. Coppinger of the Lynn Police Department; Chief Joseph Cafarelli of the Revere Police Department; and Chief David R. Fallon of the Somerville Police Department, made the announcement today.
Louisiana Man Sentenced to 30 months in Federal Prison for Role in Wire Fraud ConspiracyRead the Press Release
DALLAS — Leonard James McMorris, of Rayville, Louisiana, was sentenced this morning by Chief U.S. District Judge Barbara M. G. Lynn to 30 months in federal prison and ordered to pay $1,417,903 in restitution, following his guilty plea in March 2016 to his role in a conspiracy to commit wire fraud, announced U.S. Attorney John Parker of the Northern District of Texas.
McMorris, 50, and co-conspirator, Constance Marie Kelly, 53, were indicted in February 2009 on the conspiracy and several substantive counts of wire fraud. McMorris was eventually arrested in the Western District of Louisiana in August 2015, and has remained in custody since his arrest. Kelly was never arrested and remains a fugitive.
According to plea documents filed in his case, from approximately 2002 to 2007, McMorris and Kelly conspired to commit an extensive fraudulent scheme. During this period, Kelly worked for LandAmerica American Title Company (American Title), a title insurance agent engaged in title insurance transactions for real estate closings. As part of her duties, she had access to funds deposited in the American Title escrow account at Compass Bank.
At various times in 2006 and 2007, as part of the scheme McMorris opened several business bank accounts at banks in Texas, including Bank of America, N.A., Bank One, N.A., Bank of Texas, N.A., and Compass Bank. During the conspiracy, Kelly used at least 11 checks and 51 wire transfers to fraudulently disburse approximately $1,417,904 of American Title escrow funds into several bank accounts in Texas that McMorris controlled. Kelly concealed from American Title that she made these unauthorized and fraudulent transfers to McMorris.
The Dallas FBI investigated the case. Assistant U.S. Attorney David Jarvis is in charge of the prosecution.
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Lincoln Man Sentenced for Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney, Deborah R. Gilg, announced that on November 30, 2016, John Michael Steven Brown, 34, of Lincoln, was sentenced to ten years and one month (121 months) in prison for his role in a conspiracy to distribute and possess with the intent to distribute 500 grams or more of a substance containing methamphetamine between July of 2013 and October of 2015. Information provided to law enforcement indicated that Brown was responsible for the distribution of at least 1.5 kilograms (approximately three pounds) of methamphetamine during that time-period. Brown was found in possession of a small amount of methamphetamine in September of 2015 and more than ¼ ounce of methamphetamine in October of 2015. On both occasions, he admitted to Lincoln Police officers that he was using and selling methamphetamine and said that he had several regular customers. Following the prison term, Brown will serve five years on supervised release.
This case was investigated by the Lincoln/Lancaster County Drug Task Force.
Leader of Binghamton-Based Steroid Distribution Ring Pleads GuiltyRead the Press Release
BINGHAMTON, NEW YORK – Ryan Root, age 37, of West New York, New Jersey, and formerly of Binghamton, New York, pled guilty today to conspiring to distribute anabolic steroids and commit international money laundering.
The announcement was made by U.S. Attorney Richard S. Hartunian; Special Agent in Charge James J. Hunt, New York Division, U.S. Drug Enforcement Administration (DEA); New York State Police Superintendent George P. Beach II; and Inspector in Charge Shelly A. Binkowski, U.S. Postal Inspection Service, Boston Division.
As part of his plea, Root admitted that between January 2011 and September 2015, he purchased distribution-size quantities of anabolic steroids from China. He arranged for the steroids to be shipped directly to him and to co-conspirators, and then for the steroids to be shipped and resold throughout the United States. He also wired money to China and directed other co-conspirators to do so.
U.S. Attorney Richard S. Hartunian said: “Anabolic steroids are controlled substances that pose significant health risks when used unlawfully. Root and his organization obtained these dangerous substances from China and then distributed them throughout the country, imperiling all who purchased them. Thanks to outstanding teamwork among federal and state agencies, Root and his co-conspirators are being held accountable.”
DEA Special Agent in Charge James J. Hunt said: “Using steroids or any synthetically derived controlled substance without regulation is like playing Russian roulette. Root used his drug trafficking organization to distribute unregulated anabolic steroids, putting other people’s lives at risk. By working with our law enforcement partners, this organization was dismantled.”
New York State Police Superintendent George P. Beach II said: “This investigation uncovered a large conspiracy to illegally acquire and distribute anabolic steroids, which exposed users to potentially dangerous health risks. The ongoing collaboration between state and federal agencies was a critical factor in the success of this case, and I thank our federal partners for their outstanding work.”
Postal Inspector in Charge Shelly A. Binkowski said: “The U.S. Postal Service is in the business of moving the mail and has no interest in being involved in the distribution of illegal drugs. Anabolic steroids are a controlled substance and like any other illegal drug, we want to keep them out of the U.S. Mail and away from the general public who may not be aware of the full risks associated with their use. I commend all of our law enforcement partners who came together to bring these criminals to justice.”
Root and 9 co-conspirators were arrested on September 23, 2015. Root is the eighth defendant to plead guilty in this case. The 2 defendants whose charges are not resolved, Kent Fletcher and Michael Gisondi, are presumed innocent unless and until proven guilty.
The name of each defendant is set forth in the chart below, along with each defendant’s age, place of residence, charges, and the maximum penalties they face. None of the defendants who have pled guilty have been sentenced yet. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors. Senior U.S. District Judge Thomas J. McAvoy will sentence Root on March 13, 2017.
This case is the result of a joint investigation conducted by the DEA, the New York State Police, and the United States Postal Inspection Service. The case is being prosecuted by Assistant United States Attorney Solomon B. Shinerock.
Defendants Who Have Pled Guilty
Name
Age
Residence
Charges
Maximum Term of Imprisonment
Boylan, Paul
32
Endicott, New York
Conspiracy to Possess with Intent to Distribute Anabolic Steroids and International Money Laundering
20 years
Clark, Kyle
31
Dallas, Texas
Conspiracy to Possess with Intent to Distribute Anabolic Steroids
10 years
Doane, Caleb
31
Rancho Cucamonga, California
Conspiracy to Possess with Intent to Distribute Anabolic Steroids and International Money Laundering
20 years
Garcia, Jason
22
Duluth, Georgia
Conspiracy to Possess with Intent to Distribute Anabolic Steroids
10 years
O’Brien, Jeremiah
35
Binghamton, New York
Conspiracy to Possess with Intent to Distribute Anabolic Steroids
10 years
Progovitz, Richard
38
Owego, New York
Conspiracy to Possess with Intent to Distribute Anabolic Steroids
10 years
Root, Ryan
37
West New York, NJ
Conspiracy to Possess with Intent to Distribute Anabolic Steroids and International Money Laundering
20 years
Strassle, Derek
33
Endicott, New York
Conspiracy to Possess with Intent to Distribute Anabolic Steroids and International Money Laundering
20 years
Defendants Still Facing Charges
Name
Age
Residence
Charges
Maximum Potential Term of Imprisonment
Fletcher, Kent
48
Alpharetta, Georgia
Conspiracy to Possess with Intent to Distribute Anabolic Steroids and International Money Laundering
20 years
Gisondi, Michael
50
Belleville, New Jersey
Conspiracy to Possess with Intent to Distribute Anabolic Steroids
10 years
Last Defendant Pleads Guilty to Gang Child Sex Trafficking ConspiracyRead the Press Release
FORT WORTH, Texas — Diwone Nobles, a/k/a “Pooh,” 32, appeared before U.S. District Judge Reed C. O’Connor earlier this week and pleaded guilty to a child sex trafficking conspiracy, after jury selection began announced U.S. Attorney John Parker of the Northern District of Texas.
Nobles, who acted as a pimp, faces a minimum statutory penalty of 10 years and a maximum statutory penalty of life in federal prison, lifetime sex offender registration, lifetime supervised release and a $250,000 fine. Sentencing is set for March 20, 2017.
A total of nine defendants were charged in the case, all of whom are members of affiliates of the Polywood Crips in Ft. Worth. Five defendants were charged in the indictment with Nobles: Chad Johnson, a/k/a “Ocho Hood Fame,” 24, Audry Lane, a/k/a “Spud,” 29, Deon Bonner, a/k/a “Spanish Fly,” 26, Stanley Johnson, a/k/a “Pee Wee,” 24, and Katelyn Michelle Ward, a/k/a “KD,” 24. Audry Lane, Bonner and Stanley Johnson each pleaded guilty to one count of conspiracy to commit child sex trafficking. Chad Johnson pleaded guilty to one count of sex trafficking of children, and Ward pleaded guilty of using a facility of interstate commerce in aid of a racketeering enterprise. Last month, three others involved in the conspiracy, Alvin Lane, a/k/a “Spank,” 34, Serrah Arnold, 28, and Jessica Arnold, 23, who were charged in a felony Information pleaded guilty. Alvin Lane pleaded guilty to one count of conspiracy to commit sex trafficking of children; Serrah and Jessica Arnold each pleaded guilty to one count of use of a facility of interstate commerce in aid of a racketeering enterprise.
In November 2015, U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) learned that a 16-year-old runaway, Jane Doe 1, was being trafficked by a group of people in Fort Worth, Texas; that group included the defendants. The investigation revealed that from approximately October 1, 2013, through April 16, 2016, the members of this group facilitated the commercial sex acts of numerous minor and adult females.
Nobles, Bonner, Chad Johnson, Stanley Johnson, Audry Lane, Katelyn Ward and Alvin Lane acted as pimps for the girls and women they trafficked. They instructed them on how much to charge and they kept proceeds from transactions. They also provided the girls and women with condoms, cellular phones and hotel rooms. Some of the member of the group bought and sold the girls and women they were trafficking amongst themselves.
To locate commercial sex customers, Nobles, Bonner, Chad Johnson, Stanley Johnson, Katelyn Ward, Audry Lane and Alvin Lane facilitated the placement of advertisements on various commercial websites, including Backpage.com. In many instances, rather than placing the Backpage.com advertisement themselves, sisters Serrah and Jessica Arnold, who acted as “bottom girls,” were told to post the advertisements using Backpage.com accounts belonging to the Arnolds.
On approximately June 1, 2013, 17-year-old Jane Doe 4 was introduced to Audry Lane, Serrah and Jessica Arnold, and Alvin Lane by a family friend of the Arnolds, defendant Katelyn Ward. Ward asked the Lanes and Arnolds to teach Jane Doe 4 how to engage in commercial sex acts. Serrah and Jessica Arnold explained to Jane Doe 4 about Backpage.com and how to talk to commercial sex customers. Ward, along with Audry Lane, and later Alvin Lane, acted as Jane Doe 4’s pimp at various times between 2013 and 2015. All three pimps knew she was 17 when they began facilitating her commercial sex acts, and they kept the proceeds she earned. Various members of the group posted Jane Doe 4 on Backpage.com and facilitated her commercial sex acts.
On approximately October 10, 2015, friends Deon Bonner and Stanley Johnson met 17-year-old Jane Doe 2 and her 16-year-old friend Jane Doe 1 in Fort Worth. They took the girls to a motel on Meacham Street in Fort Worth. Shortly thereafter, Stanley Johnson told Jane Doe 2 that he wanted her to engage in commercial sex acts, and he sought help from Audry Lane and Alvin Lane to post commercial sex ads for her on Backpage.com. Stanley Johnson told Jane Doe 2 how much to charge and he bought condoms for her; he also kept the money she made from engaging in commercial sex acts.
While Stanley Johnson was causing Jane Doe 2 to engage in commercial sex acts at a Fort Worth motel, Bonner was causing Jane Doe 1 to engage in commercial sex acts in another nearby room. After several days, Bonner left the hotel, and then Chad Johnson caused Jane Doe 1 to engage in commercial sex acts. Next, Nobles began causing Jane Doe 1 to engage in commercial sex acts. Stanley Johnson and Nobles eventually took both Jane Doe 1 and Jane Doe 2 to another hotel in Fort Worth where Stanley Johnson continued to cause Jane Doe 2 to engage in commercial sex acts.
According to documents filed in the case, one adult female victim engaged in commercial sex acts at the direction of Nobles, Chad Johnson, Audry Lane, Alvin Lane, and Serrah Arnold during 2014. Nobles frequently assaulted her when she made him angry or did not follow his instructions; he also raped her. Nobles kept the money she earned and the contact phone number used in the Backpage.com ad for her services was used by Nobles. In one trip to Austin, this adult female victim made enough money for Nobles to buy a Chevy sedan that he painted bright orange – “Poly Orange” in reference to their neighborhood Polytechnic Heights – that he still owns.
When an adult female victim engaged in commercial sex acts at Chad Johnson’s direction, he physically assaulted her if she did not follow his instructions. On one occasion, Chad Johnson punched her in the ear hard enough to cause her eardrum to burst and bleed. Chad Johnson also raped her, and when he believed she had attempted to “renegade,” he had several friends gang rape her as punishment. “Renegade” is a term used to describe attempting to engage in commercial sex acts for money outside the knowledge or control of a pimp.
When an adult female victim engaged in commercial sex acts at Audry Lane’s direction, he would have Serrah Arnold, his “bottom girl,” supervise the victim and take the money she received.
A minor female victim engaged in commercial sex acts at the direction of Audry Lane, Alvin Lane, Serrah Arnold and Jessica Arnold. Alvin Lane would have his girlfriend/bottom girl, Jessica Arnold post photos of her in ads that she placed on Backpage.com. The minor female victim would give all the money she earned to Jessica or Serrah Arnold, who would then give the money to Audry Lane or Alvin Lane.
Some of the pimp’s Facebook pages contained online posts, visible to the public, that reference making a lot of money through criminal activity, namely “pimping.” Chad Johnson’s Facebook page contained photos of him posing with large sums of cash while referencing commercial sex. Several of Chad Johnson’s Facebook friends were females observed in Backpage.com ads for commercial sex. Likewise, Diwone Nobles posted numerous videos and photos on Facebook instructing others on how to pimp, and showing him counting money with various sex trafficking victims.
Nobles, Bonner, Chad Johnson, Stanley Johnson, and Audry Lane had several photos on their Facebook pages in which they can be observed flashing gang signs referencing the “Polywood Crips” street gang.
The Bureau of Alcohol, Tobacco, Firearms and Explosives, ICE HSI and the Fort Worth Police Department investigated the case. Assistant U.S. Attorney Cara Foos Pierce is in charge of the prosecution.
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Kansas Men Plead Guilty in Federal Hate Crime Against Somali MenRead the Press Release
WASHINGTON – Armando Sotelo, 24, pleaded guilty today to a hate crime offense for his role in a June 19, 2015, assault of a black Somali man in Dodge City, Kansas. Omar Cantero Martinez, 32, also pleaded guilty today to providing perjured testimony during a hate crimes prosecution arising from the same assault.
Sotelo pleaded guilty in the District of Kansas to one count of a hate crime violation based on race and national origin, while Martinez pleaded guilty to one count of perjury for providing materially false testimony during the October 2016 federal criminal jury trial related to the hate crime.
“Hate violence not only harms individuals but also threatens the diversity of our society and the well-being of our communities,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “In this case, Sotelo attacked the victim because of the color of his skin and his country of origin, inflicting bodily injury during the assault. The Justice Department will continue to vigorously prosecute hate crimes so that all people can live their lives with the security, protection and freedom they deserve.”
During Sotelo’s plea hearing, he admitted that he assaulted the victim, identified as M.H.D., because of M.H.D.’s race and national origin. Sotelo admitted that he, with the assistance of two other men, approached M.H.D., who is black and from Somalia, while M.H.D. was sitting with two other Somali men on a bench outside the African Market. The defendant approached the bench from one side, while the two other men approached the bench from the other. Sotelo and the other men all yelled racial and anti-Somali slurs at M.H.D. and at the two other Somalis on the bench. The defendant then punched M.H.D. in the head without any justification, causing M.H.D. bodily injury. Following the assault, Sotelo fled the scene and directed another person to wash his clothing, which was bloody from the assault.
During his plea hearing, Martinez admitted that on the night of June 19, 2015, he had used a broken glass bottle to stab victim S.A.M. and slash victim A.M.A. without justification. Martinez also admitted that racial and anti-Somali slurs were used during the attack and that he and Sotelo instigated the attack. He further admitted that he provided false testimony about the incident during a federal jury trial in which he and Sotelo were charged with hate crimes offenses for the attack, that he knew his testimony was false at the time that he gave it and that his false testimony was material to the hate crimes charges.
Sotelo faces a maximum sentence of 10 years in prison and Martinez faces a maximum sentence of five years in prison. Sentencing for both defendants is scheduled for Feb. 22, 2017, and they will remain in custody until then.
This case was investigated by the FBI’s Garden City Resident Agency with assistance from the Dodge City Police and the Ford County, Kansas, Sheriff’s Departments. The case is being prosecuted by Trial Attorney Risa Berkower and Special Litigation Counsel Jared Fishman of the Civil Rights Division’s Criminal Section with assistance from Assistant U.S. Attorney Mona Furst of the District of Kansas.
IF YOU HAVE QUESTIONS, PLEASE USE THE CONTACTS IN THE MESSAGE OR CALL THE OFFICE OF PUBLIC AFFAIRS AT 202-514-2007.
Justice Department Announces Reforms at Bureau of Prisons to Reduce Recidivism and Promote Inmate RehabilitationRead the Press Release
Today, the Department of Justice announced a series of reforms at the Federal Bureau of Prisons (BOP) designed to reduce recidivism and increase the likelihood of inmates’ safe and successful return to the community. These efforts include building a semi-autonomous school district within the federal prison system, reforming federal halfway houses, covering the cost of obtaining state-issued photo IDs for federal inmates prior to their release from custody and providing additional services for female inmates.
“Helping incarcerated individuals prepare for life after prison is not just sound public policy; it is a moral imperative,” said Attorney General Loretta E. Lynch. “These critical reforms will help give federal inmates the tools and assistance they need to successfully return home as productive, law-abiding members of society. By putting returning citizens in a position to make the most of their second chance, we can create stronger communities, safer neighborhoods and brighter futures for all.”
“The sweeping changes that we are announcing today chart a new course for the Bureau of Prisons that will help make our prisons more effective, our communities safer and our families stronger," said Deputy Attorney General Sally Q. Yates. “One of the best ways to prevent crime is by reducing recidivism, and one of the best ways to reduce recidivism is by equipping inmates with the tools they need to successfully reenter society."
Last year, with the department’s support, BOP retained outside consultants to review the agency’s operations and recommend changes designed to reduce the likelihood of inmates re-offending after their release from prison. As part of today’s announcement, the department is launching a new website, www.justice.gov/prison-reform, that compiles current and ongoing reforms at BOP, and includes the final reports from the outside consultants.
The department announced additional details regarding these efforts:
- Building a school district within the federal prison system. Research shows that inmates who participate in correctional education programs have 43 percent lower odds of returning to prison than those who do not, and that every dollar spent on prison education saves four to five dollars on the cost of re-incarceration. BOP is building a semi-autonomous school district within the federal prison system, which will offer programs for literacy, high school diplomas and post-secondary education, along with expanded opportunities for individuals with learning disabilities. Today, BOP also announced that it has hired Amy Lopez, an experienced educator in the Texas prison school system, to serve as the first superintendent of BOP’s school district.
- Reforming federal halfway houses. BOP is overhauling Residential Reentry Centers (RRCs), popularly known as “halfway houses,” which provide housing for approximately 80 percent of inmates during the final months of their federal sentences. Since the early 1980s, the ownership and operation of RRCs have been fully privatized, with BOP relying on a mix of for-profit companies and non-profit organizations. Today, Deputy Attorney General Yates issued a memorandum directing BOP to leverage its purchasing power and overhaul this private market. Among other things, the memorandum directed BOP to establish clear, uniform and improved standards for all RRC providers; expand the collection and publication of RRC performance data; and explore alternative models that would create a more effective and efficient market for federal reentry services.
- Covering the cost of state-issued IDs prior to inmates’ release. Possession of government-issued identification documents is critical to successful reentry. Without such documentation, men and women leaving correctional facilities face significant challenges securing employment and housing, registering for school, opening bank accounts and accessing other benefits, such as health care, that are critical to successful integration. The department announced today that BOP will begin paying for every federal inmate to obtain a birth certificate and a state-issued identification card before they arrive at RRCs. An independent consultant estimated that this effort will save the agency approximately $19 million a year, by making it easier for inmates to find a stable job and post-custody housing, which allows BOP to more quickly transfer inmates to less expensive forms of custody such as home confinement.
- Enhancing programs for female inmates. Next month, BOP will resume housing female inmates at its facility in Danbury, Connecticut, making it easier for female inmates from the Northeast to remain in contact with their families. In addition, the Danbury facility will house BOP’s first-ever integrated treatment facility for female inmates, which will feature a mental health unit and a women’s Residential Drug Abuse Program, the agency’s most intensive substance abuse treatment course.
These initiatives are part of the department’s deep commitment to a fair, effective criminal justice system that promotes public safety and prepare inmates for their return to the community, thereby reducing the likelihood that a cycle of crime will continue.
Jury Finds Allied Home Mortgage Entities and CEO Liable for Civil Mortgage Fraud - Awards $92 Million in DamagesRead the Press Release
HOUSTON – A federal jury has found the entities formerly known as Allied Home Mortgage Capital Corporation (Allied Capital) and Allied Home Mortgage Corporation (Allied Corporation) as well as president and CEO Jim C. Hodge liable in connection with more than a decade of fraudulent misconduct related to Allied’s participation in the Federal Housing Administration (FHA) mortgage insurance program. The jury returned the verdicts late yesterday following a five-week trial, finding Allied and Hodge violated the False Claims Act (FCA) and the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA).
U.S. Attorney Kenneth Magidson of the Southern District of Texas and U.S. Attorney Preet Bharara of the Southern District of New York made the announcement along with Julián Castro, Secretary of the Department of Housing and Urban Development (HUD), and HUD Inspector General David A. Montoya.
The jury awarded the United States a total of $92,982,775 in damages, including $7,370,132 against Hodge specifically. Pursuant to the FCA, the damages in this case are subject to trebling. In addition, the court must impose a mandatory penalty of $5,500 to $11,000 for each violation. Separately, FIRREA also provides for a penalty for each statutory violation. U.S. District Judge George C. Hanks Jr., who presided over the trial, will determine the total penalties and damages at a later date.
“The excellent coordination between personnel from our two U.S. Attorney’s Offices and with HUD investigators has resulted in a tremendous win for the government,” said Magidson. “Working together, we ensured a successful outcome following a lengthy trial and investigation against Allied and its CEO. We will continue to apply our resources whenever and wherever we can to ensure those that perpetuate such egregious fraud against the United States are held accountable for their actions.”
“For years, Hodge and Allied repeatedly lied to HUD in order to fraudulently reap profits from the FHA mortgage insurance program,” said Bharara. “After a month-long public trial where all their misconduct was exposed, a jury has held Hodge and Allied responsible for their lies and has made them pay for losses the United States suffered on loans that would never have been insured by HUD absent their lies. This case represents yet another recovery by the United States – this time after a trial – for fraud perpetrated against HUD by participants in the Direct Endorsement Lender program.”
“The heart of our mission is to weed out actors such as these that are intent on defrauding federal housing programs,” said Montoya. “This should serve as a notice to all those determined to engage in illegal schemes such as these that they are not beyond the reach of the federal law enforcement community.”
FHA mortgage insurance makes home ownership possible for millions of American families by protecting lenders against mortgage defaults. FHA mortgage insurance also makes mortgage loans valuable in the resale market. To protect the continued availability of FHA mortgage insurance funds, HUD must accurately assess the risk of default on the loans it insures. To accomplish this task, HUD relies on assurances by lenders that they, and the loans they submit for insurance, comply with program requirements.
As a HUD-approved loan correspondent, Allied Capital originated FHA-insured mortgage loans and was required to seek HUD approval for each branch office from which it originated such loans. Allied Capital did not comply. Instead, with Hodge’s approval, Allied Capital operated more than 100 “shadow” branch offices that originated FHA loans without HUD authorization. As part of its scheme to deceive HUD, the jury heard that Allied Capital submitted loans originated by those branches to HUD using the ID numbers of approved branches. Allied Capital’s undisclosed shadow branches were not subject to HUD oversight and their default rates were disguised by the default rates of branches whose IDs they were using. This fraudulent misconduct resulted in $7,370,132 in losses to HUD when some of those loans defaulted.
The jury also heard that Allied Corporation, as a participant in HUD’s Direct Endorsement Lender program, underwrote FHA-insured mortgage loans. For each FHA-insured mortgage loan, Allied Corporation was required to certify to HUD that the loan was underwritten according to HUD’s guidelines. Those guidelines ensure that FHA-insured loans are made only to borrowers who can repay them, thereby seeking to avoid losses to HUD’s FHA insurance fund and foreclosures on borrowers’ homes. Allied Corporation, however, recklessly underwrote and certified at least 1,192 loans for FHA insurance under HUD’s guidelines. This fraudulent misconduct resulted in losses to HUD of $85,612,643 when those loans defaulted.
To compound matters, Allied Capital and Allied Corporation (Allied) and Hodge operated a dysfunctional quality control program and lied to HUD about it. HUD requires lenders participating in its programs to timely perform quality control audits of their FHA loans to identify and correct systemic problems, including underwriting problems. Allied only employed a handful of quality control employees to review loans from as many as 600 branch offices. Further, many of those employees were unqualified to audit FHA-insured loans. In addition, Hodge personally directed his employees to falsify quality control reports to give the impression that required reviews had been performed, when in fact they had not. When HUD auditors later asked for those quality control reports, Allied provided the falsified reports. Allied and Hodge also falsely certified to HUD on an annual basis that Allied was in compliance with HUD’s quality control requirements.
The case was pending as a qui tam whistleblower lawsuit in the Southern District of New York (SDNY) when the United States filed a complaint-in-intervention in November 2011. The following year, the case was transferred to the Southern District of Texas (SDTX). SDNY attorneys Jeannette A. Vargas, Joseph N. Cordaro, Jean-David Barnea, Caleb Hayes-Deats and Stephen Cha-Kim handled the matter and were designated as Special Assistant U.S. Attorneys for SDTX.
Bharara and Magidson thanked HUD’s Office of General Counsel and HUD-Office of Inspector General for their extraordinary assistance with this case.
Jury Finds Allied Home Mortgage Entities and CEO Jim C. Hodge Liable for Civil Mortgage Fraud, Awards the United States over $92 Million in DamagesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Kenneth Magidson, the United States Attorney for the Southern District of Texas, Julián Castro, Secretary of the United States Department of Housing and Urban Development (“HUD”), and David A. Montoya, Inspector General of HUD (“HUD-OIG”), announced today that a unanimous jury has found the entities formerly known as ALLIED HOME MORTGAGE CAPITAL CORPORATION (“ALLIED CAPITAL”) and ALLIED HOME MORTGAGE CORPORATION (“ALLIED CORPORATION”) (collectively, “ALLIED”), as well as ALLIED’s president and chief executive officer JIM C. HODGE (“HODGE”), liable for violating the False Claims Act (“FCA”) and the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (“FIRREA”) in connection with over a decade of fraudulent misconduct related to ALLIED’s participation in the Federal Housing Administration (“FHA”) mortgage insurance program. The jury awarded the United States a total of $92,982,775 in damages, including $7,370,132 against HODGE. Pursuant to the FCA, damages in this case are subject to mandatory trebling. In addition, the FCA provides for a penalty of $5,500 to $11,000 for each violation. Separately, FIRREA provides for a penalty for each statutory violation. The Court will determine the amount of the penalties at a later date. The verdict was returned yesterday following a five-week trial in Houston before United States District Judge George C. Hanks, Jr., of the United States District Court for the Southern District of Texas.
Manhattan U.S. Attorney Preet Bharara said: “For years, Jim Hodge and Allied lied to HUD in order to fraudulently reap profits from the FHA mortgage insurance program. After a month-long public trial where all their misconduct was exposed, a jury has held Mr. Hodge and Allied responsible for their lies and has made them pay for losses the United States suffered on loans that would never have been insured by HUD absent their lies. This case represents yet another recovery by the United States – this time after a trial – for fraud perpetrated against HUD by participants in the Direct Endorsement Lender program.”
Houston U.S. Attorney Kenneth Magidson said: “The excellent coordination between personnel from our two U.S. Attorney’s Offices and with HUD investigators has resulted in a tremendous win for the government. Working together, we ensured a successful outcome following a lengthy trial and investigation against Allied and its CEO. We will continue to apply our resources whenever and wherever we can to ensure those that perpetuate such egregious fraud against the United States are held accountable for their actions.”
HUD Inspector General David A. Montoya said: “The heart of our mission is to weed out actors such as these that are intent on defrauding federal housing programs. This should serve as a notice to all those determined to engage in illegal schemes such as these that they are not beyond the reach of the federal law enforcement community.”
According to the evidence presented at trial:
FHA mortgage insurance makes home ownership possible for millions of American families by protecting lenders against mortgage defaults. FHA mortgage insurance also makes mortgage loans valuable in the resale market. To protect the continued availability of FHA mortgage insurance funds, HUD must accurately assess the risk of default on the loans it insures. To accomplish this task, HUD relies on assurances by lenders that they, and the loans they submit for insurance, comply with program requirements.
As a HUD-approved loan correspondent, ALLIED CAPITAL originated FHA-insured mortgage loans. ALLIED CAPITAL was required to seek HUD approval for each branch office from which it originated FHA loans. Instead of complying with this requirement, however, ALLIED CAPITAL, with HODGE’s knowledge and approval, operated over one hundred “shadow” branch offices that originated FHA loans without HUD authorization. As part of its scheme to deceive HUD, ALLIED CAPITAL submitted loans originated by those branches to HUD using the ID numbers of approved branches. ALLIED CAPITAL’s undisclosed shadow branches were not subject to HUD oversight and their default rates were disguised by the default rates of branches whose IDs they were using. This fraudulent misconduct resulted in $7,370,132 in losses to HUD when certain of those loans defaulted.
ALLIED CORPORATION, as a participant in HUD’s Direct Endorsement Lender program, underwrote FHA-insured mortgage loans. For each FHA-insured mortgage loan, ALLIED CORPORATION was required to certify to HUD that the loan was underwritten according to HUD’s guidelines. Those guidelines ensure that FHA-insured loans are made only to borrowers who can repay them, thereby seeking to avoid losses to HUD’s FHA insurance fund and foreclosures on borrowers’ homes. ALLIED CORPORATION, however, recklessly underwrote and certified at least 1,192 loans for FHA insurance that were ineligible for insurance under HUD’s guidelines. This fraudulent misconduct resulted in losses to HUD of $85,612,643 when those loans defaulted.
To compound matters, ALLIED and HODGE operated a dysfunctional quality control program and lied to HUD about it. HUD requires lenders participating in its programs to timely perform quality control audits of their FHA loans to identify and correct systemic problems, including underwriting problems. ALLIED, however, employed only a handful of quality control employees to review loans from as many as 600 branch offices. Many of those employees were unqualified to audit FHA-insured loans. In addition, HODGE personally directed his employees to falsify quality control reports to give the impression that required reviews had been performed, when in fact they had not. When HUD auditors later asked for those quality control reports, ALLIED provided the falsified reports. ALLIED and HODGE also falsely certified to HUD on an annual basis that ALLIED was in compliance with HUD’s quality control requirements.
The United States filed a complaint-in-intervention in this lawsuit in November 2011. At that time, the action was pending as a qui tam whistleblower lawsuit in the United States District Court for the Southern District of New York. In September 2012, the action was transferred to the United States District Court for the Southern District of Texas.
* * *
Mr. Bharara and Mr. Magidson thanked HUD’s Office of General Counsel and HUD-OIG for their extraordinary assistance with this case.
This case is being handled by the Civil Frauds Unit of the United States Attorney’s Office for the Southern District of New York. Assistant United States Attorneys Jeannette A. Vargas, Joseph N. Cordaro, Jean-David Barnea, Caleb Hayes-Deats, and Stephen Cha-Kim, who were designated as Special Assistant United States Attorneys for the Southern District of Texas for purposes of this matter, are in charge of the case.
Jewelry Store Owner Sentenced to Two Years in Prison for Role in International, $200 Million Credit Card Fraud ScamRead the Press Release
TRENTON, N.J. – A New Jersey jewelry store owner who used his business to further one of the largest credit card fraud schemes ever charged by the Justice Department was sentenced today to 24 months in prison, U.S. Attorney Paul J. Fishman announced.
Vinod Dadlani, 53, of Lyndhurst, New Jersey, previously pleaded guilty before U.S. District Judge Anne E. Thompson to an information charging him with one count of conspiracy to commit bank fraud. Judge Thompson imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
Dadlani was indicted in October 2013 as part of a conspiracy – led by Tahir Lodhi, Babar Qureshi, Ijaz Butt, and others – to fabricate more than 7,000 false identities to obtain tens of thousands of credit cards. Since then, 19 people, including Dadlani, have pleaded guilty in connection with the scheme.
The scheme involved a three-step process in which the defendants would make up a false identity by creating fraudulent identification documents and a phony credit profile with the major credit bureaus; pump up the credit of the false identity by providing bogus information about that identity’s creditworthiness; then borrowed or spent as much as they could without repaying the debts – causing more than $200 million in confirmed losses to businesses and financial institutions.
Many of these debts were incurred at Dadlani’s Jersey City, New Jersey, jewelry store, among many other locations. During his guilty plea proceeding, Dadlani admitted he worked with other conspirators who came to his store and allowed them to swipe cards he knew did not legitimately belong to them. Dadlani would then split the proceeds of the phony transactions with the conspirators.
The scope of the criminal fraud enterprise required Dadlani’s conspirators to construct an elaborate network of false identities. Across the country, the conspirators maintained more than 1,800 “drop addresses,” including houses, apartments and post office boxes, which they used as the mailing addresses for the false identities.
In addition to the prison term, Judge Thompson sentenced Dadlani to two years of supervised release and ordered him to pay forfeiture of $411,000.
U.S. Attorney Fishman credited special agents of the FBI’s Cyber Division, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to today’s sentencing. He also thanked postal inspectors with the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge James V. Buthorn, Newark Division, special agents of the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt, and the U.S. Social Security Administration for their assistance.
The government is represented by Assistant U.S. Attorneys Zach Intrater and Daniel V. Shapiro of the U.S. Attorney’s Office Economic Crimes Unit, as well as Assistant U.S.
Attorney Barbara Ward, Acting Chief of the Asset Forfeiture and Money Laundering Unit.
This case was brought in coordination with President Barack Obama’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’s 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. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
Defense counsel: Vincent Sarubbi Esq., Haddonfield, New Jersey
Hurricane meth dealer sentenced to federal prison for drug crimeRead the Press Release
CHARLESTON, W.Va. – A Hurricane man was sentenced today to two years in federal prison for a methamphetamine crime, announced United States Attorney Carol Casto. Shawn Keathley, 26, previously pleaded guilty to distribution of methamphetamine.
Keathley admitted that on March 20, 2014, he sold methamphetamine to a confidential informant working with the Metropolitan Drug Enforcement Network Team. The drug deal took place in the parking lot of a restaurant in Cross Lanes. Keathley further admitted to having distributed methamphetamine for approximately five months in the Kanawha County area.
The Metropolitan Drug Enforcement Network Team and the West Virginia State Police conducted the investigation. Assistant United States Attorney John J. Frail is responsible for the prosecution. United States District Judge Thomas E. Johnston imposed the sentence.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of illegal drugs, including methamphetamine. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down pill trafficking, eliminating open air drug markets, and curtailing the spread of illegal drugs in communities across the Southern District.
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Hartford Man Sentenced to More Than 6 Years in Federal Prison for Gun and Heroin OffensesRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ROMAN PANTOJAS, 28, of Hartford, was sentenced today by U.S. District Judge Vanessa L. Bryant in Hartford to 74 months of imprisonment, followed by five years of supervised release, for gun and drug offenses.
According to court documents and statements made in court, on May 23, 2014, the ATF, DEA and Hartford Police executed a federal search warrant at PANTOJAS’s Hartford residence and seized approximately 700 baggies of heroin, two loaded handguns and approximately $2,400 in cash. The investigation revealed that PANTOJAS, a convicted felon who is not permitted to purchase or possess firearms lawfully, had received firearms from his heroin customers.
One of PANTOJAS’s drug customers, Justin Ashline, admitted to law enforcement that he stole a firearm from his employer and sold it to PANTOJAS in exchange for approximately 20 bags of heroin and between $70 and $100 in cash.
On July 28, 2014, PANTOJAS pleaded guilty to one count of possession of a firearm by a previously convicted felon and one count of possession with intent to distribute heroin.
Ashline also pleaded guilty and is currently incarcerated.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Drug Enforcement Administration, Connecticut State Police and Hartford Police Department. The case was prosecuted by Assistant U.S. Attorney Robert M. Spector.
Harrisburg Man Sentenced to Two Years in Prison for Illegally Selling Prescription DrugsRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Gerard Grant, age 60, of Harrisburg, was sentenced by United States District Court Judge Yvette Kane in Harrisburg, to two years in federal prison for unlawfully distributing prescription drugs.
According to United States Attorney Bruce D. Brandler, Grant admitted to selling approximately 500 Vicodin tablets, a controlled substance which contained hydrocodone, to an individual cooperating with the Drug Enforcement Administration. Grant also admitted to selling the Vicodin tablets on five different occasions in Harrisburg to others.
The case was investigated by the Harrisburg Resident Office of the Drug Enforcement Administration, the Pennsylvania State Police, the Dauphin County Drug Task Force, and the Harrisburg Police Department. Assistant United States Attorney William A. Behe prosecuted the case.
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Hamden Man Sentenced to Prison for Distributing Oxycodone Involved in Weston OverdoseRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that TAHIR FARID, 22, of Hamden, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to six months of imprisonment, followed by three years of supervised release, for distributing oxycodone involved in an overdose earlier this year.
According to court documents and statements made in court, on January 3, 2016, a 20-year-old male purchased 30 oxycodone pills from FARID in exchange for $900. He then consumed some of those pills, as well as other substances, including Xanax. On January 5, 2016, the 20-year-old male was found unresponsive at a friend’s residence in Weston. He remains unresponsive, has no brain activity and is currently receiving care in a nursing home.
The investigation revealed that, prior to the victim’s overdose, Ryan Looney, also of Hamden, supplied FARID with oxycodone pills. FARID then distributed the pills to the victim.
FARID was arrested on February 22, 2016. On April 26, he pleaded guilty to one count of possession with intent to distribute, and distribution of, oxycodone.
Looney pleaded guilty to the same charge and is scheduled to be sentenced on December 6.
Judge Chatigny ordered FARID, during his three-year term of supervised release, to perform 120 hours of community service, and requested that the community service be directed at educating school-aged children about the dangers of using opioids.
This prosecution is part of an ongoing statewide initiative targeting narcotics dealers who distribute heroin, fentanyl or opioids that cause death or serious injury to users.
This matter is being investigated by the Drug Enforcement Administration’s New Haven Tactical Diversion Squad, U.S. Marshals Service, Weston Police Department and Monroe Police Department. The Tactical Diversion Squad includes members from the New Haven, Hamden, Greenwich, Shelton, Bristol, Vernon, Wilton, Milford, Monroe, Fairfield and Manchester Police Departments, and the Connecticut State Police.
This case is being prosecuted by Assistant U.S. Attorney Robert M. Spector.
Greenfield Man Sentenced to 15 Months on Gun ChargeRead the Press Release
Contact: F. Todd Lowell
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty, II announced that Tobin White, 42, of Greenfield Township, Maine, was sentenced today in U.S. District Court by Judge John A. Woodcock, Jr. to 15 months in prison and one year of supervised release for being a prohibited person in possession of a firearm. White pleaded guilty to an indictment on January 17, 2014.
On February 12, 2013, law enforcement officers executed a search warrant at the defendant’s home in Greenfield Township. As officers approached, the defendant left the house holding a flashlight and a Smith & Wesson 9mm pistol. When the officers identified themselves and ordered the defendant to the ground, he complied. Officers found the gun in a holster next to the defendant. The defendant was prohibited from possessing the firearm because he had been convicted of a misdemeanor crime of domestic violence (assault) in 2003.
The case was investigated by the Maine Warden Service. the Federal Bureau of Investigation and the Maine State Police.
Georgia Woman Sentenced for Role in Methamphetamine ConspiracyRead the Press Release
ABINGDON, VIRGINIA – A member of a conspiracy that distributed methamphetamine in and around Virginia and Kentucky, was sentenced today in the United States District Court for the Western District of Virginia in Abingdon, announced United States Attorney John P. Fishwick Jr.
Tracie Cartwright, of Lawrenceville, Georgia, previously pled guilty to one count of conspiring to possess with the intent to distribute and to distribute methamphetamine. Today in District Court, Cartwright was sentenced to 188 months in federal prison.
“Methamphetamine is an addictive and deadly substance,” United States Attorney Fishwick said today. “We are proud to work with our partners on the local, state and federal levels to continue to fight to the scourge of methamphetamine trafficking throughout the region.”
This investigation has charged 15 individuals with being part of the conspiracy, two of which have already been sentenced to federal prison terms.
The investigation of the case was conducted by the Bell County, Kentucky Sheriff’s Office, the Middlesboro, Kentucky Police Department, the Lee County Virginia Sheriff’s Office and Bureau of Alcohol, Tobacco, Firearms and Explosives Bristol and Atlanta Field Divisions. Assistant United States Attorney Zachary T. Lee prosecuted the case for the United States.
Franklin, N.C. Man Arrested on Federal Arson ChargeRead the Press Release
ASHEVILLE, N.C. – Keith Eugene Mann, 49, of Franklin, N.C. was arrested today on federal arson charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. A federal criminal complaint filed this afternoon in U.S. District Court, charges Mann with one count of destroying real property of the United States by means of fire.
U.S. Attorney Rose is joined in making today’s announcement by Steven F. Ruppert, Special Agent in Charge, U.S. Forest Service Law Enforcement and Investigation, Southern Region and Sheriff Robert L. Holland of the Macon County Sheriff’s Office.
According to allegations in the affidavit filed with the criminal complaint, on October 27, 2016, a wildfire was reported on U.S. Forest Service (USFS) Road 388, commonly referred to as Board Tree Road, which is in Macon Co., and within the Nantahala National Forest. The fire was named “Grape Cove.” Court documents allege that the initial investigation of the fire determined that it was set intentionally. Additional investigation revealed that five other fires had been set in close proximity to the Grape Cove Fire, however they appeared to have gone out on their own. As alleged in court documents, over the course of the investigation of these small fires, law enforcement located several wooden stem matches. USFS firefighters conducted suppression of the wildfire, which burned approximately fifteen acres.
According to allegations contained in filed court documents, on November 22, 2016, a wildfire was reported at the end of U.S. Forest Service Road 763, commonly referred to as Jones Creek Road, by someone who identified himself as “Keith Mann.” USFS firefighters responded to the fire and took immediate suppression action. The fire was contained at approximately one acre and was named “Jones Creek.” As alleged in the criminal complaint, law enforcement became aware that a suspicious vehicle, identified as a mid-sized Chevrolet pickup, had been observed in the area.
According to allegations in the complaint, on November 23, 2016, law enforcement returned to the fire site. While there, law enforcement observed a small cardboard box located at the origin of the fire, with numerous burned wooden stemmed matches next to the box. According to allegations in the charging document, on the same day, law enforcement identified the caller who placed the call to Macon County 911 to report the second fire as the defendant, Keith Mann. Law enforcement made contact with Mann who admitted to setting the fires both on Board Tree Road and on Jones Creek Road.
The defendant had his initial appearance today before U.S. Magistrate Judge Dennis Howell. Mann’s detention hearing has been set for Monday, December 5, 2016.
The charge of destroying real property of the United States by means of fire carries a mandatory penalty of five years and a maximum of 20 years in prison.
The charges contained in the criminal complaint are allegations. The defendant is presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law.
The U.S. Forest Service is leading the investigation assisted by the Macon County Sheriff’s Office. Assistant United States Attorney Richard Edwards is in charge of the prosecution.
Four New Jersey Members of Violent, International Street Gang Sentenced to Life in Prison for Racketeering-Related ChargesRead the Press Release
NEWARK, N.J. – Five members of the New Jersey branch of the international street gang “La Mara Salvatrucha,” or “MS-13”– including the branch’s founding member – were sentenced to prison for their roles in a violent criminal enterprise that included murder, extortion, and plots to kill witnesses, U.S. Attorney Paul J. Fishman and Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division announced today.
Santos Reyes-Villatoro, a/k/a “Mousey,” 43, of Bound Brook, New Jersey, Julian Moz-Aguilar, a/k/a “Humilde,” 29, of Plainfield, New Jersey, and Hugo Palencia, a/k/a “Taliban,” 24, of Plainfield, were each sentenced today to life plus 10 years in prison. Mario Oliva, a/k/a “Zorro,” 30, and Esau Ramirez, a/k/a “Panda,” 25, both of Plainfield, were sentenced Nov. 27, 2016 to life plus 10 years in prison and 169 months in prison, respectively.
All five defendents were previously convicted following a 16-week trial before U.S. District Judge Stanley R. Chesler, who imposed the sentences this week in Newark federal court. Reyes-Villatoro, Oliva, Moz-Aguilar, and Palencia were each convicted of racketeering conspiracy, murder in aid of racketeering, use of a firearm in a violent federal crime, and murder resulting from a federal firearm crime. Ramirez was convicted of racketeering conspiracy and conspiracy to commit murder in aid of racketeering.
According to the documents filed in this case and the evidence presented at trial:
MS-13 is a national and transnational gang with branches or “cliques” operating throughout the United States, including in Plainfield. All of the defendants were members of the “Plainfield Locos Salvatruchas” (PLS) clique of MS-13 that was founded by Reyes-Villatoro and operated in Union, Somerset, and Middlesex Counties. Reyes-Villatoro, Oliva and Roberto Contreras, a/k/a “Demonio,” 28, of Bound Brook, all served as “First Word,” or leader, of PLS.
From 2007 through September 2013, MS-13 members from PLS committed five murders in furtherance of MS-13’s objectives. On Feb. 9, 2009, Reyes-Villatoro, acting as the leader of PLS, drove Moz-Aguilar and other MS-13 members through the streets of Plainfield searching for rival gang members, eventually stopping at the Plainfield train station. There, Moz-Aguilar used a firearm previously provided by Reyes-Villatoro to murder a victim who was believed to be a member of the Latin Kings, a rival gang.
On Feb. 27, 2010, Oliva drove a female member of MS-13 to an empty parking lot in Piscataway, New Jersey, and murdered her because she was suspected of working with law enforcement. Oliva then fled New Jersey with the assistance of Contreras and hid from law enforcement with the MS-13 Pinos clique in Oxon Hill, Maryland.
On Nov. 11, 2010, Palencia drove another MS-13 member to the area around Barack Obama Academy in Plainfield, where they encountered students challenging MS-13. Palencia pulled over, provided a firearm to another MS-13 member and instructed him to shoot at one of the individuals. The MS-13 member shot into the crowd, killing a bystander.
On Jan. 10, 2011, Moz-Aguilar, Contreras and other MS-13 members were in a car when they spotted a suspected 18th Street gang member in front of a restaurant. Contreras stopped the vehicle and an MS-13 member exited, approached the suspected rival gang member and shot him in the head.
On May 8, 2011, Cruz Flores, a/k/a “Bruja,” 30, of Bound Brook, murdered a victim who was caught socializing with 18th Street gang members. Flores and another MS-13 member cut his throat, beat him with a bat and stabbed him in the back 17 times. An MS-13 member involved in this murder fled New Jersey and was driven to Maryland soon after law enforcement began searching for him.
Jose Garcia, a/k/a “Chucky” and “Diabolico,” 24, of Plainfield, recruited and hired MS-13 members from the Maryland-based Pinos clique to come to New Jersey and murder a woman in exchange for $40,000. The Pinos clique members were arrested by authorities as they pulled into Plainfield.
After several MS-13 members were arrested in July 2011, Ramirez and Garcia used phones from inside the Union County, New Jersey, jail to order the murder of three witnesses believed to be cooperating with police and responsible for their arrests.
According to evidence presented at trial, members of PLS also were responsible for an attempted murder of suspected Latin King members near a car wash in Plainfield; the attempted murder of suspected Latin King members in January 2009; a machete attack in May 2011 and another in June 2011 on the train tracks passing through Plainfield; an attempted murder shooting in Plainfield in May 2011; and several other violent crimes, including extortion, robbery and several weapons offenses.
The defendants were originally charged in a 26-count indictment returned by a federal grand jury in September 2013. As of today, 13 of the 14 individuals charged in that indictment have been convicted. One defendant remains a fugitive. Contreras, Garcia, and Flores await sentencing.
U.S. Attorney Fishman and Assistant Attorney General Caldwell credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark; Immigration and Customs Enforcement, Enforcement and Removal Operations (ERO), under Newark Field Office Director John Tsoukaris; and Homeland Security Investigations (ICE-HSI), under the direction of Special Agent in Charge Terence S. Opiola, with the investigation. They also thanked the Union County Prosecutor’s Office, under the direction of Acting Prosecutor Grace H. Park, for long, close collaboration on the case.
They also thanked the Somerset County Prosecutor’s Office, under the direction of Acting Prosecutor Michael H. Robertson, and the Middlesex County Prosecutor’s Office, under the direction of Prosecutor Andrew C. Carey, for their roles. They also acknowledged the U.S. Attorney’s Offices for the Eastern District of Virginia and the District of Maryland, as well as the Plainfield Police Department, Union County Police Department, Union County Sheriff’s Office, Elizabeth Police Department, North Plainfield Police Department, Union County Department of Corrections, Prince George’s County, Maryland, Police Department and the U.S. Marshal’s Service for their assistance.
The government is represented by Assistant U.S. Attorneys James M. Donnelly and J. Jamari Buxton of the U.S. Attorney’s Office Criminal Division in Newark and by Kevin L. Rosenberg, of the Organized Crime and Gangs Section of the Department of Justice.
Four MS-13 Members Sentenced to Life and a Fifth to 169 Months in Prison for Racketeering-Related ChargesRead the Press Release
Five New Jersey gang members were sentenced to prison today and Monday of this week for conspiring to participate in racketeering activities and committing murders on behalf of the racketeering enterprise known as La Mara Salvatrucha, or MS-13, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Paul J. Fishman of the District of New Jersey announced.
Santos Reyes-Villatoro, aka “Mousey,” 43, of Bound Brook, New Jersey, Julian Moz-Aguilar, aka “Humilde,” 29, of Plainfield, New Jersey, and Hugo Palencia, aka “Taliban,” 24, of Plainfield, were each sentenced today to life plus 120 months in prison. Mario Oliva, aka “Zorro,” 30, and Esau Ramirez, aka “Panda,” 25, both of Plainfield, were sentenced Nov. 27, 2016 to life plus 120 months in prison and 169 months in prison, respectively.
All five defendants were previously convicted following a 16-week trial before U.S. District Judge Stanley R. Chesler of the District of New Jersey. Reyes-Villatoro, Oliva, Moz-Aguilar and Palencia were each convicted of racketeering conspiracy, murder in aid of racketeering, use of a firearm in a violent federal crime and murder resulting from a federal firearm crime. Ramirez was convicted of racketeering conspiracy and conspiracy to commit murder in aid of racketeering.
According to the documents filed in this case and the evidence presented at trial, MS-13 is a national and transnational gang with branches, or cliques, operating throughout the United States, including in Plainfield. All of the defendants were members of the Plainfield Locos Salvatruchas (PLS) clique of MS-13 that was founded by Reyes-Villatoro and operated in Union, Somerset and Middlesex Counties. Reyes-Villatoro, Oliva and Roberto Contreras, aka “Demonio,” 28, of Bound Brook, all served as leaders, or First Word, of PLS.
According to the trial evidence, from 2007 through September 2013, MS-13 members from PLS committed five murders in furtherance of MS-13’s objectives. On Feb. 9, 2009, Reyes-Villatoro, acting as the leader of PLS, drove Moz-Aguilar and other MS-13 members through the streets of Plainfield searching for rival gang members, eventually stopping at the Plainfield train station. There, Moz-Aguilar used a firearm previously provided by Reyes-Villatoro to murder a victim who was believed to be a member of the Latin Kings, a rival gang.
On Feb. 27, 2010, Oliva drove a female member of MS-13 to an empty parking lot in Piscataway, New Jersey, and murdered her because she was suspected of working with law enforcement. Oliva then fled New Jersey with the assistance of Contreras and hid from law enforcement with the MS-13 Pinos clique in Oxon Hill, Maryland.
On Nov. 11, 2010, Palencia drove another MS-13 member to the area around Barack Obama Academy in Plainfield, where they encountered students challenging MS-13. Palencia pulled over, provided a firearm to another MS-13 member and instructed him to shoot at one of the individuals. The MS-13 member shot into the crowd, killing a bystander.
On Jan. 10, 2011, Moz-Aguilar, Contreras and other MS-13 members were in a car when they spotted a suspected 18th Street gang member in front of a restaurant. Contreras stopped the vehicle and an MS-13 member exited, approached the suspected rival gang member and shot him in the head.
On May 8, 2011, Cruz Flores, aka “Bruja,” 30, of Bound Brook, murdered a victim who was caught socializing with 18th Street gang members. Flores and another MS-13 member cut his throat, beat him with a bat and stabbed him in the back 17 times. An MS-13 member involved in this murder fled New Jersey and was driven to Maryland soon after law enforcement began searching for him.
The evidence presented at trial also showed that Jose Garcia, aka “Chucky” and “Diabolico,” 24, of Plainfield, recruited and hired MS-13 members from the Maryland-based Pinos clique to come to New Jersey and murder a woman in exchange for $40,000. The Pinos clique members were arrested by authorities as they pulled into Plainfield, before the murder could occur. In addition, after several MS-13 members were arrested in July 2011, Ramirez and Garcia used phones from inside the Union County, New Jersey, jail to order the murder of three witnesses believed to be cooperating with police and responsible for their arrests. Members of PLS also were responsible for an attempted murder of suspected Latin King members near a car wash in Plainfield; the attempted murder of suspected Latin King members in January 2009; a machete attack in May 2011 and another in June 2011 on the train tracks passing through Plainfield; an attempted murder shooting in Plainfield in May 2011; and several other violent crimes, including extortion, robbery and several weapons offenses.
The defendants were originally charged in a 26-count indictment returned by a federal grand jury in September 2013. Currently, 13 of the 14 individuals charged in that indictment have been convicted, and one defendant remains a fugitive. Contreras, Garcia and Flores await sentencing.
The FBI’s Newark Field Office, U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations and ICE Homeland Security Investigations investigated the case. The Union County Prosecutor’s Office provided substantial assistance in the investigation. The Somerset County, New Jersey, Prosecutor’s Office; Middlesex County, New Jersey, Prosecutor’s Office; U.S. Attorney’s Offices of the Eastern District of Virginia and the District of Maryland; Plainfield Police Department; Union County Police Department; Union County Sheriff’s Office; Elizabeth, New Jersey, Police Department; North Plainfield, New Jersey, Police Department; Union County Department of Corrections; Prince George’s County, Maryland, Police Department; and the U.S. Marshals Service also provided assistance in this matter. Trial Attorney Kevin L. Rosenberg of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys James Donnelly and Jamari Buxton of the District of New Jersey are prosecuting this case.
Former Local Employee Pleads Guilty to ExtortionRead the Press Release
CINCINNATI –Carlos Ruiz-Rodriguez, 25, of Cincinnati, Ohio, has pleaded guilty to extortion against a Cincinnati-based company. He was indicted by a federal grand jury in August.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Division, announced the plea entered into today before U.S. District Judge Michael R. Barrett.
Ruiz-Rodriguez pleaded guilty to intruding computers and stealing proprietary information from the company he worked for.
He had been employed at the company for approximately two years as a call center employee. In his role, he had access to the company’s customer service portal and personally identifiable information for certain clients.
Ruiz-Rodriguez sent multiple extortion emails to the company between November 2015 and January 2016 via the internet showing proof of compromise of the company’s data. He stated that if the company did not pay a Bitcoin ransom, then the company schematics and client data would be released to the public.
Ruiz-Rodriguez then posted the company’s data on an internet “dark web” forum and received two separate ransom payments from his employer totaling approximately $15,000.
Extortion is a crime punishable by up to two years in prison.
U.S. Attorney Glassman commended the investigation of this case by the FBI, and Assistant United States Attorney Tim Mangan, who is prosecuting the case.
Former CWA Local President Indicted for Embezzlement and Bank FraudRead the Press Release
BIRMINGHAM – A federal grand jury today indicted the former president of the Communications Workers of America, Local 3901, in Oxford, Ala., for a scheme to embezzle more than $69,000 from the local chapter, announced U.S. Attorney Joyce White Vance and U.S. Department of Labor, Office of Labor-Management Standards, Investigator Hollis Lindley Jr.
A nine-count indictment filed in U.S. District Court charges MICHAEL LACKEY, 43, of Bremen, Ga., with bank fraud, embezzlement of labor union funds and failure to maintain labor union records.
Local 3901 members elected Lackey president in October 2008 and he remained in that position until October 2014. As president, Lackey held sole responsibility and control over the local’s finances, including its accounts at Wells Fargo and Regions banks.
According to the indictment, Lackey executed a scheme to defraud the banks between February 2010 and October 2014 by using his position as Local 3901 president to conduct unauthorized transactions to take money from the local’s bank accounts and use it for his personal benefit. Those transactions included writing checks to himself from Local 3901 accounts for unauthorized or nonexistent travel expenses, using debit cards he obtained on accounts for the local at both Regions and Wells Fargo for personal expenses, and making cash withdrawals from Local 3901 accounts at both banks for his personal use, the indictment charges.
Lackey embezzled about $69,194 from Local 3901 and attempted to conceal the theft by failing to maintain records of his unauthorized transactions and by failing to seek approval for expenditures, as required by federal law and the Local 3901 constitution and bylaws, according to the indictment.
The maximum penalty for bank fraud is 30 years in prison and a $250,000 fine. The maximum penalty for embezzlement is five years in prison and a $10,000 fine, and the maximum for failure to maintain labor union records is one year and a $10,000 fine.
The U.S. Department of Labor, Office of Labor-Management Standards, investigated the case, which Assistant U.S. Attorney Xavier O. Carter Sr. is prosecuting.
An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.
Florida Keys Boat Lift Installation Company and South Florida Resident Sentenced in Connection with Rivers and Harbors Act ViolationsRead the Press Release
A Florida Keys boat lift installation company and a South Florida resident pled guilty and were sentenced in connection with the installation of illegal boat lifts without the requisite federal permits from the United States Army Corp of Engineers (ACOE).
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; Colonel Jason Kirk, District Engineer, United States Army Corps of Engineers, Jacksonville District; John F. Khin, Special Agent in Charge, Defense Criminal Investigative Service (DCIS), Southeast Field Office; Frank Robey, Director, United States Army Criminal Investigation Command, Major Procurement Fraud Unit; and Andy Castro, Special Agent in Charge, United States Environmental Protection Agency (EPA), Criminal Investigation Division, Atlanta Area Office.
Florida Keys company Kevin P. Mason Builder, LLC (Mason) and Jennifer Ashlee Davis, 32, of Tavernier, pled guilty and were sentenced today in federal court in Key West before United States District Court Judge Jose E. Martinez. Mason and Davis pled guilty for their involvement in the building of approximately twelve boat lifts and associated structures without federal permits issued by the ACOE, in violation of Title 33, United States Code, Sections 403 and 406. Mason was sentenced to five years of probation, ordered to pay a $15,000 fine, and required to implement and enforce an Environmental Compliance Plan. Davis was sentenced to one year of probation and ordered to pay a $2,000 fine.
According to court records, including a joint factual statement, the Rivers and Harbors Act prohibits commencing building any structure in any navigable water of the United States without authorization from the ACOE. Mason was in the business of installing boat lifts and other associated structures in navigable waters and was subject to ACOE permitting. Davis was the permitting agent, acting on behalf of Mason and the individual property owners. Both Mason and Davis were responsible for applying for and obtaining all necessary authorization including, but not limited to, ACOE permits. Mason and Davis knew that permits were required, prior to commencing all work. Between February 1, 2015 and September 30, 2015, the Mason and Davis commenced and/or completed 12 boat lift installations knowing no ACOE authorization had been granted.
U.S. Attorney Wifredo Ferrer stated, “It is imperative that companies and their agents abide by all compliance programs, including permit regulations, to ensure the protection of our environment.”
“The United States Army Corps of Engineers, Department of Defense, is charged with managing the Intracoastal Waterways to protect vital resources,” said Special Agent in Charge John F. Khin, Defense Criminal Investigative Service (DCIS) Southeast Field Office. “DCIS will investigate those who defraud the Government by circumventing United States law intended to protect our waterways, and hold them accountable for their actions. This resolution sends a clear message that preserving the environment of the Florida Keys is taken very seriously.”
“The United States Army Corps of Engineers, is responsible for regulating construction activities, which affect the navigable waters of the United States,” said Director Frank Robey, Major Procurement Fraud Unit (MPFU), United States Army Criminal Investigation Command (USACIDC). “USACIDC will investigate those who defraud the Government to circumvent United States laws intended to protect our navigable waters, and hold them accountable for their actions. This resolution sends a clear message that preserving the environment of the Florida navigable waters is a priority for the United States Army.”
Mr. Ferrer commended the investigative efforts of the U.S. Army Corps of Engineers, DCIS, U.S. Army Criminal Investigation Command’s, Major Procurement Fraud Unit, and EPA. The case was prosecuted by Special Assistant U.S. Attorney Jodi A. Mazer of the Economic & Environmental Crimes Section.
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.
Federal Judge Sentences Former Headmaster to Five Years for Stealing Nearly $9 Million from School and Affiliated ChurchRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Max O. Cogburn, Jr. today sentenced the former headmaster of a Huntersville, N.C. area parochial school to 60 months in prison for embezzling nearly $9 million from the school and its affiliated church, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Wayne C. Parker, Jr., 57, of Mooresville, N.C., was also ordered to serve three years under court supervision after he is released from prison and to pay $6,606,463 as restitution in addition to the approximately $3,000,000 the defendant has already paid.
U.S. Attorney Rose is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief Cleveland L. Spruill of the Huntersville Police Department.
According to information contained in filed court documents and today’s sentencing hearing, from about January 2000 to in or about August 2014, Parker executed a scheme to defraud his employer, a parochial school (School) and its affiliated church (Church), both located in Huntersville, of at least $9 million, by embezzling Church and School bank funds to pay for his personal expenses and the personal expenses of an unnamed co-conspirator.
Court documents show that sometime after joining the Church in 1991, Parker became volunteer treasurer, giving him access to and control over the Church bank accounts. In 1996, Parker was hired as Headmaster of the School, which was founded in 1994 by members of the Church. As headmaster, Parker was responsible for the administration of the School and its finances and had control over its bank accounts.
According to court documents, beginning in at least 2000, Parker began stealing money from the Church and School and used it to pay for personal expenses. For example, in 2000, when he needed extra money to build a house for his family in Mooresville, Parker stole approximately $100,000 from the School and Church to complete the project. Over the next 14 years, court documents allege that Parker used School and Church funds to pay for numerous expenses, including, among other things, the purchase of multiple plots of real estate; vacations around the world; luxury vehicles; luxury dining; Carolina Panthers preferred seats licenses; credit card bills; a boat and jet skis; gold and silver coins; and gifts for family and friends. In 2010, court records show that Parker stole School and Church funds to build a lake front house for approximately $1.2 million dollars. In order to properly fund the construction, Parker made all the School employees take a 5% cut which he publically claimed was due to tough economic conditions.
According to court records, as part of the scheme to siphon School and Church funds, and to hide his theft, Parker opened approximately 29 checking accounts, obtained 26 credit cards, seven loans, and created nine limited liability companies.
As reflected in court documents, in addition to embezzling funds for his own use, Parker also embezzled School and Church funds at the direction of an unnamed co-conspirator. Court documents allege that beginning in 2000, Parker issued additional paychecks to the co-conspirator above and beyond what he was entitled to by the terms of the co-conspirator’s employment. As the scheme progressed overtime, in addition to extra salary checks, Parker used Church and School funds to pay for the co-conspirator’s personal expenses, including college tuition, medical bills, taxes, cars, and credit card bills.
As part of his scheme, and to hide his embezzlement activities from the School’s governing board, Parker created a false, fraudulent and fictitious document from an accounting firm purporting to be the results of an audit. The document falsely stated that the School had been through a full audit and received an unqualified opinion letter giving the School a clean financial bill of health.
According to court documents, in the summer of 2014, after the Church leadership became suspicious of Parker’s activities and called for an independent audit, Parker intentionally stole and destroyed school financial records in an attempt to prevent law enforcement and others from discovering the nature and extent of his embezzlement activities. Additionally, Parker sold one of the houses that he had constructed with embezzled funds to one of his children, for a significantly undervalued price, to hide his crimes and prevent law enforcement from seizing that property. In total Parker’s scheme resulted in a loss of at least $9 million dollars to the Church and School.
In announcing today’s sentence, Judge Cogburn stated, “There has been a huge amount of money stolen,” and that the defendant’s actions were “A concentrated effort over a long period of time,” adding that these “Dedicated teachers deserve better than what’s happened to them.”
Parker will be ordered to report to the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The investigation was handled by the FBI and the Huntersville Police Department. The prosecution for the government is being handled by Assistant United States Attorney Kevin Zolot of the U.S. Attorney’s Office in Charlotte.
Federal Judge Sentenced Altoona Heroin Dealer to 8 Years in PrisonRead the Press Release
JOHNSTOWN, Pa. - A resident of Altoona, Pa., has been sentenced in federal court to 96 months in prison, and four years’ supervised release on his conviction of conspiracy to distribute and possess with the intent to distribute a quantity of heroin, Acting United States Attorney Soo C. Song announced today.
United States District Judge Kim R. Gibson imposed the sentence on Darrin Canaan, 37, of Altoona, Pa.
According to information presented to the court, from Jan. 22, 2015, to April 17, 2015, Canaan conspired to distribute and possess with the intent to distribute a quantity of heroin.
Assistant United States Attorney Stephanie L. Haines prosecuted this case on behalf of the government.
Ms. Song commended the Laurel Highlands Resident Agency of the Federal Bureau of Investigation, the Pennsylvania Attorney General's Office, the Cambria County Drug Task Force, the Altoona Police Department, and the Cambria County District Attorney's Office, for the investigation leading to the successful prosecution of Canaan.
Evansville man charged with two eastside business robberiesRead the Press Release
Alleged to have robbed a Walmart Neighborhood Market and Walgreens Pharmacy
PRESS RELEASE
Evansville—United States Attorney Josh J. Minkler announced today charges against an Evansville man for his role in two Evansville robberies. Malcolm Washington 24, was indicted by a federal grand jury on charges of robbery and using a firearm in relation to a crime of violence.
“Reducing violent crime in our neighborhoods remains a top priority of my office,” said Minkler. “Those who choose to terrorize our local businesses using firearms, will face the hammer of federal prosecution.”
Count one of the indictment alleges that on October 17, 2016, Washington entered the Walmart Neighborhood Market at 3430 Taylor Avenue and while brandishing a firearm stole money from the cash register and cigarettes from the counter. He also demanded employees to go to a certain area of the store and took their debit cards and cell phones.
Count two and three of the indictment allege on October 17, 2016, Washington entered the Walgreens at 925 South Green River Road and brandished a firearm demanding the clerk take him to the business safe and took money from both the safe and the cash register.
A short time after the Walgreens’ robbery, officers from the Evansville Police Department located Washington in the vicinity carrying a handgun in his coat pocket. He pointed the gun at the officers but dropped it on the ground. He picked it up and ran from the officers but was quickly apprehended a short time later.
This case was jointly investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Federal Bureau of Investigation, the Evansville Police Department and the Vanderburgh County Sheriff’s Office.
“There is no place in our community for individuals who use firearms for criminal purposes,” said Trevor Velinor, Special Agent in Charge of ATF’s Columbus Field Division. “ATF will continue to work with the United States Attorney’s Office, the FBI, the Evansville Police Department, and the Vanderburgh County Sheriff’s Office to ensure that individuals who engage in violent acts are brought to justice.”
“The Evansville Police Department appreciates the continued assistance from the U.S. Attorney’s Office as we work together to remove dangerous criminals from our community,” said Chief Billy Bolin.
According to Assistant United States Attorney Lauren M. Wheatley who is prosecuting this case for the government, Washington could face up to life imprisonment if convicted on all counts.
An indictment is only charge and not evidence of guilt. All parties are presumed innocent until proven otherwise in federal court.
Employee of Biofuel Feedstock Company Pleads Guilty to ConspiracyRead the Press Release
An employee of a New Jersey feedstock collector and processor pleaded guilty to conspiracy for his role in a scheme to alter and destroy documents following the company’s receipt of a subpoena issued by a federal grand jury sitting in the Southern District of Ohio.
William Letona, 49, pleaded guilty before U.S. District Magistrate Judge Norah McCann King for the Southern District of Ohio, announced Assistant Attorney General John C. Cruden for the Department of Justice’s Environment and Natural Resources Division, Acting U.S. Attorney Benjamin C. Glassman for the Southern District of Ohio and Acting Special Agent in Charge John Gauthier of Environmental Protection Agency’s (EPA) Criminal Enforcement Program in Ohio.
Letona admitted to conspiring with others to obstruct a grand jury investigating the fraudulent generation of EPA renewable fuels credits (RIN credits) and Internal Revenue Service (IRS) tax credits connected to the purported production of renewable fuel. Specifically, documents were falsified and destroyed in order to hide the fact that fuel purchased from a broker by Letona’s employer, Unity Fuels, was sold back to the broker as “Recycled Vegetable Oil Blend.” This maneuver enabled RIN credits and IRS credits to be claimed multiple times on the same material.
“Lies and deceit intended to thwart federal investigations will not be tolerated,” said Assistant Attorney General Cruden. “This case demonstrates that the Department of Justice will vigorously prosecute those who act dishonestly in responding to federal Grand Jury subpoenas.”
Conspiracy is punishable by up to five years in prison. U.S. District Judge James L. Graham will determine Letona’s sentence following a pre-sentence investigation by the court.
Assistant Attorney General Cruden and Acting U.S. Attorney Glassman commended the cooperative investigation by law enforcement, including the IRS and the Federal Bureau of Investigation, as well as Department of Justice Trial Attorney Adam Cullman, Senior Trial Attorney Jeremy Korzenik and Assistant United States Attorney J. Michael Marous, who represented the United States in this case.
Court Authorizes Service of John Doe Summons Seeking the Identities of U.S. Taxpayers Who Have Used Virtual CurrencyRead the Press Release
A federal court in the Northern District of California entered an order today authorizing the Internal Revenue Service (IRS) to serve a John Doe summons on Coinbase Inc., seeking information about U.S. taxpayers who conducted transactions in a convertible virtual currency during the years 2013 to 2015. The IRS is seeking the records of Americans who engaged in business with or through Coinbase, a virtual currency exchanger headquartered in San Francisco, California.
“As the use of virtual currencies has grown exponentially, some have raised questions about tax compliance,” said Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division. “Tools like the John Doe summons authorized today send the clear message to U.S. taxpayers that whatever form of currency they use – bitcoin or traditional dollars and cents – we will work to ensure that they are fully reporting their income and paying their fair share of taxes.”
“Transactions in virtual currency are taxable just like those in any other property,” said IRS Commissioner John Koskinen. “The John Doe summons is a step designed to help the IRS ensure people doing business in the emerging economy are following the tax laws and meeting their responsibilities.”
Virtual currency, as generally defined, is a digital representation of value that functions in the same manner as a country’s traditional currency. There are nearly a thousand virtual currencies, but the most widely known and largest is bitcoin. Because transactions in virtual currencies can be difficult to trace and have an inherently pseudo-anonymous aspect, taxpayers may be using them to hide taxable income from the IRS. In the court’s order, U.S. Magistrate Judge Jacqueline Scott Corley found that there is a reasonable basis for believing that virtual currency users may have failed to comply with federal tax laws.
The IRS has issued guidance regarding the tax consequences on the use of virtual currencies in IRS Notice 2014-21, which provides that virtual currencies that can be converted into traditional currency are property for tax purposes, and a taxpayer can have a gain or loss on the sale or exchange of a virtual currency, depending on the taxpayer’s cost to purchase the virtual currency (that is, the taxpayer’s tax basis).
The court’s order grants the IRS permission to serve what is known as a “John Doe” summons on Coinbase. There is no allegation in this suit that Coinbase has engaged in any wrongdoing in connection with its virtual currency exchange business. Rather, the IRS uses John Doe summonses to obtain information about possible violations of internal revenue laws by individuals whose identities are unknown. This John Doe summons directs Coinbase to produce records identifying U.S. taxpayers who have used its services, along with other documents relating to their virtual currency transactions.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Cheektowaga Man Pleads Guilty to Child Pornography ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.- Acting U.S. Attorney James P. Kennedy, Jr. announced today that Joseph Kurowski, 23, of Cheektowaga, NY, plead guilty to possession of child pornography before U.S. District Judge Lawrence J. Vilardo. The charge carries a maximum sentence of 10 years in prison and a fine of $250,000.
Assistant U.S. Attorney Aaron J. Mango, who is handling the case, stated that in the spring of 2015, Kurowski began communicating via text message with a 17-year-old female. The text messages were sexually explicit in nature. On April 10, 2015, the defendant asked her to send him a sexually explicit photograph which she then sent via text message. Kurowski was aware that she was a minor at the time he received this image.
The plea is the culmination of an investigation by the Federal Bureau of Investigation, under the direction of Adam S. Cohen, Special Agent-In-Charge and the Blasdell Police Department, under the direction of Lieutenant Joseph Gramaglia.
Sentencing is scheduled for March 7, 2017, at 9:00 a.m. before Judge Vilardo.
Check Casher Indicted for Role in Stolen Identity Refund Fraud SchemeRead the Press Release
A federal grand jury sitting in Macon, Georgia returned an indictment against a Columbus, Georgia resident on Nov. 9, which was unsealed today, for her role in a stolen identity refund fraud conspiracy, announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division, and U.S. Attorney G.F. Peterman III for the Middle District of Georgia.
According to the indictment, throughout 2013, Shade Bakare cashed fraudulently obtained tax refund checks at the request of several individuals, including co-conspirators Tracy and Dameisha Mitchell, in exchange for a fee. Bakare endorsed several of the checks, and cashed many of the checks at Big O’s Package Store located in Columbus, Georgia. Bakare provided the cash, minus the fee she charged, to Dameisha Mitchell and others. In addition to cashing these refund checks, Bakare filed fraudulent tax returns using stolen identities. Bakare obtained an Electronic Filing Identification Number from co-conspirator Danielle Wallace and used it to file fraudulent tax returns. Bakare directed the tax refunds to financial institutions which issued the refunds via check. Bakare and others cashed those checks at various locations, including Big O’s Package Store.
An indictment merely alleges that crimes have been committed. All defendants are presumed innocent until proven guilty beyond a reasonable doubt.
If convicted, Bakare faces a statutory maximum sentence of five years in prison for the conspiracy count, 10 years in prison for each theft of public funds count, 20 years in prison for each wire fraud count, and a mandatory minimum sentence of two years in prison for aggravated identity theft. Bakare also faces a period of supervised release and monetary penalties.
Principal Deputy Assistant Attorney General Ciraolo and U.S. Attorney Peterman commended special agents of Internal Revenue Service-Criminal Investigation and the U.S. Secret Service, who conducted the investigation, and Trial Attorney Michael C. Boteler of the Tax Division and Assistant U.S. Attorney Melvin Hyde of the Middle District of Georgia, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Check Casher Indicted for Role in Stolen Identity Refund Fraud SchemeRead the Press Release
WASHINGTON – A federal grand jury sitting in Macon, Georgia returned an indictment against a Columbus, Georgia resident on Nov. 9, which was unsealed today, for her role in a stolen identity refund fraud conspiracy, announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division, and U.S. Attorney G.F. Peterman III for the Middle District of Georgia.
According to the indictment, throughout 2013, Shade Bakare cashed fraudulently obtained tax refund checks at the request of several individuals, including co-conspirators Tracy and Dameisha Mitchell, in exchange for a fee. Bakare endorsed several of the checks, and cashed many of the checks at Big O’s Package Store located in Columbus, Georgia. Bakare provided the cash, minus the fee she charged, to Dameisha Mitchell and others. In addition to cashing these refund checks, Bakare filed fraudulent tax returns using stolen identities. Bakare obtained an Electronic Filing Identification Number from co-conspirator Danielle Wallace and used it to file fraudulent tax returns. Bakare directed the tax refunds to financial institutions which issued the refunds via check. Bakare and others cashed those checks at various locations, including Big O’s Package Store.
An indictment merely alleges that crimes have been committed. All defendants are presumed innocent until proven guilty beyond a reasonable doubt.
If convicted, Bakare faces a statutory maximum sentence of five years in prison for the conspiracy count, 10 years in prison for each theft of public funds count, 20 years in prison for each wire fraud count, and a mandatory minimum sentence of two years in prison for aggravated identity theft. Bakare also faces a period of supervised release and monetary penalties.
Principal Deputy Assistant Attorney General Ciraolo and U.S. Attorney Peterman commended special agents of Internal Revenue Service-Criminal Investigation and the U.S. Secret Service, who conducted the investigation, and Trial Attorney Michael C. Boteler of the Tax Division and Assistant U.S. Attorney Melvin Hyde of the Middle District of Georgia, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Carlsbad Man Sentenced to Federal Prison for Role in Scheme to Launder Money for Drug Rings, Including the Sinaloa CartelRead the Press Release
LOS ANGELES – A Carlsbad man has been sentenced to five years and three months in federal prison for his part in an international money laundering organization that conspired to move more than $15 million dollars in drug money for organizations that included the Sinaloa Cartel.
Bradley John Martin, 55, received the 63-month sentence on Monday from United States District Judge Christina A. Snyder.
Martin pleaded guilty in May to conspiracy to launder money and operating an unlicensed money remitting business. The illegal scheme spanned the world and involved operatives in Canada, India, the United States and Mexico who laundered drug trafficking proceeds generated the sale of narcotics in Canada and the United States for and on behalf of the Sinaloa Cartel and their affiliated drug trafficking organizations. The laundered money was to have either been transported to the Sinaloa Cartel as profits or reinvested in additional narcotics to be sold and distributed in the United States and Canada.
In his plea agreement, Martin admitted that he was a repeat money courier in an international “hawala” ring that transferred narcotics proceeds for the Sinaloa drug cartel and other drug trafficking organizations. Specifically, Martin admitted to personally transporting over $1.8 million in cash that he knew to be the proceed of drug trafficking.
“Law enforcement will continue to use every available tool to cripple the operations of major drug trafficking operations like the Sinaloa Cartel,” said United States Attorney Eileen M. Decker. “This case shows that membership in the cartel is not a prerequisite to prosecution; criminals outside of the cartel that enable drug trafficking will also face substantial prison sentences.”
According to the indictment, a “hawala” is an alternative form or method of money remittance which operates outside of traditional banking or financial systems. Through hawala transactions, only the value of the money is transferred, not the money itself. The hawala system transfers money via a network of brokers known as “hawaladars.” In its most basic form, a hawala needs at least two brokers who are typically located in separate countries (but can be located in different cities within one country). The transfer of monetary value occurs between the brokers based solely upon the trust that exists between the brokers. Thus, there are no promissory instruments or any legally binding features of the hawala system. The necessary trust and long-established connections between brokers are typically based on familial, ethnic, religious, regional and/or cultural grounds. Often, a given hawala network consists of many brokers operating in multiple countries around the world in which all brokers are in contact with each other and money movements can occur in a variety of directions from one country to another.
The indictment specifically alleges that the hawala network transferred more than $4.5 million in narcotics proceeds and was involved in the trafficking of 29 kilograms of cocaine and approximately 90 pounds of methamphetamine. However, during the course of a four-year federal wiretap investigation by the Drug Enforcement Administration’s LA Strike Force and IRS Criminal Investigation, authorities seized a total of $15,467,293 in bulk United States currency, 321 kilograms of cocaine, 98 pounds of methamphetamine, 11 kilograms of MDMA (“ecstasy”) and nine kilograms of heroin.
“Individuals lending assistance to drug traffickers in the form of laundering drug proceeds are arguably no better than the traffickers themselves,” said Drug Enforcement Administration Special Agent in Charge John S. Comer. “Martin’s sentence is a warning to others that might be tempted to collude with drug trafficking organizations.”
“Martin – a frequent money courier for the Sinaloa Drug cartel – used Bud Light and Diet Coke cardboard drink boxes to move illicit drug proceeds through Southern California. IRS Criminal Investigation will continue our vigilant pursuit of unlicensed money transmitters who attempt to circumvent the financial system of the United States,” stated Anthony J. Orlando, Acting Special Agent in Charge of IRS Criminal Investigation.
Martin is one of 15 defendants who have been arrested in this case. Of the 15 who have been arraigned, 11 have pleaded guilty, and four of them have been sentenced. Three defendants are scheduled for trial in April, 2017. One defendant – Breidi Alberto Espinoza, 28, of Corona – was arrested this summer, subsequently freed on bond, and is now a fugitive who is believed to have fled to Mexico.
The indictment charges seven defendants who are currently fugitives. They are:
- Sanjeev Bhola, of India;
- Balwat Bhola, of India;
- Bakshish Sidhu, of India;
- Jason Robert Carey, 37, a resident of the province of Ontario;
- Jesus Manuel Perez Rios, 33, of Coachella, who authorities believe fled to Mexico;
- Tina Pham, 25, of Montreal; and
- a Canadian man known only as “Buddy.”
The investigation in this case is being conducted by the Drug Enforcement Administration and IRS Criminal Investigation. These agencies received assistance and support from the Santa Ana Police Department, the Beverly Hills Police Department and the Pomona Police Department.
This case is being prosecuted by Assistant United States Attorneys Carol Alexis Chen and Ellen E. Lansden of the Organized Crime Drug Enforcement Task Force.
CEO of Schaumburg Consulting Firm Arrested on Fraud Charges for Misrepresenting Company’s Financial ConditionRead the Press Release
CHICAGO — The chief executive of a publicly-traded consulting firm has been charged in federal court with fraudulently misrepresenting the company’s financial condition and lying to regulators.
NANDU THONDAVADI, the CEO of Schaumburg-based Quadrant 4 System Corp., intentionally misrepresented the firm’s cash flow and concealed its liabilities in filings with the U.S. Securities and Exchange Commission, according to a criminal complaint and affidavit filed in U.S. District Court in Chicago. Thondavadi certified filings that misrepresented and concealed from the company’s auditors and shareholders the terms of certain acquisitions and the amount of a liability stemming from a lawsuit, the complaint states. The misrepresentations and concealments were intended to artificially inflate the company’s share price, according to the complaint.
The complaint charges Thondavadi and Quadrant 4’s chief financial officer, DHRU DESAI, with one count of wire fraud and one count of willfully certifying false financial reports. Thondavadi faces an additional charge of making false statements to the SEC.
Thondavadi, 62, of North Barrington, and Desai, 55, of Barrington, were arrested this morning. They are scheduled to make initial court appearances today at 11:30 a.m. before U.S. Magistrate Judge Michael T. Mason.
Also this morning, federal authorities executed a search warrant at Quadrant 4’s corporate headquarters in the 1500 block of East Woodfield Road in Schaumburg.
The complaint and arrests were 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 SEC assisted in the investigation.
Quadrant 4 has offices in seven U.S. states as well as India. It provides software products, platforms and consulting services to customers in the healthcare and education sectors. As a publicly traded company, Quadrant 4 is required to provide to the SEC on a quarterly and annual basis a detailed report of its financial condition.
Federal authorities launched an investigation of the company earlier this year based on indications that the firm’s recent annual reports to the SEC contained false information, the complaint states. The investigation revealed that Thondavadi and Desai certified the reports even though they knew the documents did not fairly present the true financial condition of the company, according to the complaint. Thondavadi then lied under oath when questioned by the SEC in May about some of the falsehoods, the complaint states.
The public is reminded that a complaint is not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Wire fraud and willfully certifying false financial reports are each punishable by up to 20 years in prison, while making false statements to the SEC is punishable by up to five years. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
The government is represented by Assistant U.S. Attorney Matthew Madden.
Berkeley County man pleads guilty to oxycodone distributionRead the Press Release
MARTINSBURG, WEST VIRGINIA – Michael Ernest Marshall, 33, of Charles Town, West Virginia, pled guilty to distributing oxycodone, United States Attorney William J. Ihlenfeld, II, announced.
Marshall admitted to distributing oxycodone in Jefferson County, West Virginia in June 2016. He pled guilty to one count of “Possession with Intent to Distribute Oxycodone.” He faces up to 20 years in prison and a fine of up to $1,000,000. 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 Paul T. Camilletti and Special Assistant U.S. Attorney Lara Omps-Botteicher, also of the West Virginia Assistant Attorney General’s Office, prosecuted the case on behalf of the government. The Drug Enforcement Administration and the Jefferson County Sheriff’s Office investigated.
U.S. Magistrate Judge Robert W. Trumble presided.
Baltimore Man Sentenced to over 31 Years in Federal Prison for Extortion Related to a MurderRead the Press Release
Baltimore, Maryland –Matthew Hightower, age 34, of Baltimore, was sentenced today to 380 months in prison, followed by five years of supervised release, for collection of a debt by extortionate means, and use of interstate facilities for extortion resulting in death in connection with the murder of victim David Wutoh. Hightower was convicted by a federal jury on September 22, 2016, after a seven-day trial.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Nicholas DiGiulio, Office of Investigations, Office of Inspector General of the Department of Health and Human Services; and Chief James W. Johnson of the Baltimore County Police Department.
According to evidence presented at trial, in 2013, Matthew Hightower was employed at RX Resources and Solutions (RXRS) as a delivery driver. RXRS was owned by Hightower’s co-defendant, Harry Crawford, who was also Hightower’s boss at RXRS.
According to trial testimony and Crawford’s plea agreement, in 2013 Crawford approached Hightower to facilitate a loan to Crawford’s longtime friend, David Wutoh. Wutoh promised Hightower that in exchange for $15,000 in cash, Wutoh would pay Hightower $20,000 within a short period of time. Crawford also loaned Wutoh at least $6,000 of his own money. Wutoh did not pay either man back the money he had borrowed, and as a result, from May through September 2013, Crawford and Hightower used cellular telephones and electronic messaging to harass, threaten, and coerce Wutoh to repay the loans.
For example, according to Crawford’s plea agreement, on June 7, 2013, Wutoh sent an electronic message to Crawford stating, “Battery dying.” Crawford responded, “You will be also. Stop playing with people’s money.” On June 11, 2013, Crawford left Wutoh a voicemail, “Dave, I hope you don’t wanna go to sleep permanently. Give me a call.”
According to trial testimony, after further discussions about whether Wutoh would pay Hightower back, Crawford texted Wutoh on June 12, 2013, “You are putting me in a bad bad bad position I vouch for you and now you are sh**ting on Matt I have no control if you get hurt...” In response to these threats, Wutoh paid Hightower $6,000 of the $20,000 he had promised. On August 27, 2013, Hightower texted Wutoh that he was “really sick of your lies.” On September 6, 2013, Wutoh sent a message to Hightower in an attempt to repay Hightower with prescription drugs instead of money, which Hightower refused. Between September 6 and September 9, 2013, Hightower sent several messages to Wutoh about wanting his “money,” including a text to Wutoh stating, “Wheres my cheese man I don’t have time for these games.” “Cheese” is a slang term for money. On September 13, 2013, Crawford sent a message to Wutoh telling him to put him in his will. Wutoh responded to Crawford, “you are.” As of September 21, 2013, Wutoh had not repaid Hightower or Crawford all of the money he borrowed from them.
According to trial testimony, on the evening of September 21 and the early morning hours of September 22, 2013, Hightower traveled from West Baltimore to East Baltimore County in the area of Wutoh’s home. According to testimony at Hightower’s trial, at approximately 2:45 a.m., Matthew Hightower walked up to the driveway of the house where Wutoh was staying and shot seven times through the window at Wutoh, who was asleep on the couch in the living room. Wutoh was shot in the arm, leg, and head, killing him almost instantly. Then Hightower fled the scene. According to the evidence presented in court, moments later, Hightower answered a phone call on a phone he used, but had registered in another person’s name. Records showed the phone was located in close proximity to the house where Wutoh was murdered. Hightower was subsequently interviewed by investigators, and he denied being “anywhere” in the vicinity of the murder. Several weeks later, Crawford asked an associate of Wutoh questions about Wutoh’s will.
On November 22, 2016, Harry Crawford, age 56, of Baltimore, pleaded guilty to: collection of a debt by extortionate means from victim David Wutoh; conspiracy to commit health care fraud in connection with schemes to defraud Medicaid and other health benefit programs of more than $1.2 million; and conspiracy to defraud the United States, for not reporting income from the health care fraud scheme on his taxes, resulting in over $125,000 in taxes owed. Judge Garbis scheduled sentencing for Crawford on March 28, 2017, at 11:30 a.m. Crawford is released under the supervision of U.S. Pretrial Services.
Hightower and co-defendant Elma Myles, age 52, of Baltimore, are scheduled to go to trial on charges related to the health care fraud scheme on January 23, 2017. Hightower remains detained.
United States Attorney Rod J. Rosenstein commended the HHS-OIG, IRS, and Baltimore County Police Department for their work in the investigation, and thanked the Maryland Attorney General’s Office Medicaid Fraud Control Unit for its assistance. Mr. Rosenstein thanked Assistant U.S. Attorneys Aaron S.J. Zelinsky, Judson T. Mihok, and Sandra Wilkinson, who are prosecuting the case.
Aquarium Operator Sentenced to Additional Prison Term for Violating Conditions of ReleaseRead the Press Release
Aquarium operator re-sentenced to eight additional months of incarceration, after violating conditions of his release.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Tracy Dunn, Assistant Director, NOAA Fisheries Office of Law Enforcement, and David Pharo, Resident Agent in Charge U.S. Fish & Wildlife Service, Miami, made the announcement.
Ammon Covino, 43, formerly of Meridian, Idaho, was ordered to return to prison today for eight months and to serve an additional one-year term of supervised release, following a re-sentencing hearing before U.S. District Judge Jose E. Martinez in Key West. Covino violated court-imposed employment restrictions as a result of his 2013 conviction for conspiring to harvest, transport, and sell spotted eagle rays and lemon sharks, knowing the marine life were taken, possessed, transported, sold, and intended to be sold in violation of the laws and regulations of the State of Florida, contrary to the federal Lacey Act, all in violation of Title 18, United States Code, Section 371.
According to the original charging Indictment, during the period of March 2012 through approximately November 2012, Covino and others purchased and transported wildlife from the Florida Keys to Idaho for exhibit at the Idaho Aquarium in Boise. The wildlife included spotted eagle rays and lemon sharks, which required Florida licenses and permits never acquired by the participants in the deals. Covino at the time was an officer of the Aquarium, had been advised of the requirements of the law, and nevertheless directed his Florida-based suppliers to ignore the law and make the shipments. Unknown to Covino at the time of the phone calls, that business owner was cooperating with federal authorities and the phone conversations and text messages were recorded. Payment for the various specimens was made by credit cards held in the Aquarium?s name. In the same case, Idaho Aquarium, Inc. pled guilty to the same conspiracy count and was ordered to pay a $50,000 penalty.
Covino was originally sentenced in December 2013 by United States District Court Judge Jose E. Martinez to a term of imprisonment of one year and a day, followed by a term of supervised release of 2 years, and was barred from any employment during that period that involved the possession, display, transportation, exhibition, purchase, or sale of marine life.
In February 2016, Covino was sentenced to an additional 3 months in prison and a $50,000 financial penalty, for violating the special employment restrictions after agents discovered that he had secretly become involved in the development and construction of two aquarium facilities in the State of Texas, using false names and false claims of employment.
According to statements made in court during today’s hearing, within five days of Covino’s release from his most recent prison sentence, he again became involved in consulting and directing the development, construction, and exhibition details for two new aquarium facilities, located in Layton, Utah and Las Vegas, Nevada. Covino traveled to visit the facilities several times and lied to his probation officer regarding his travels.
Mr. Ferrer commended the joint investigative efforts of the Special Agents of the NOAA Office of Law Enforcement and the Fish & Wildlife Service Office of Law Enforcement who participated in the long-term investigation into the illegal harvesting and sale of marine life resources from the Florida Keys. This matter was prosecuted by Assistant U.S. Attorney Thomas Watts-FitzGerald of the Economic & Environmental Crimes Section.
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.
Alleged Pimp Arrested on Federal Sex Trafficking Charges Related to 16-Year-Old Victim Who Worked as Prostitute in Inland EmpireRead the Press Release
RIVERSIDE, California – Law enforcement authorities have arrested an alleged pimp who is charged with trafficking a 16-year-old girl and advertising her services as a prostitute in an online publication.
Lawrence Gunn Jr., 32, was arrested without incident Tuesday afternoon at a Woodland Hills apartment complex where he appears to have been residing. Gunn was arrested pursuant to a criminal complaint filed last week in United States District Court that that charges him with sex trafficking of a child by force, fraud or coercion.
The arrest of Gunn was announced today when the criminal complaint was unsealed. Gunn made his initial appearance in the case this afternoon in federal court in Riverside and remains in custody.
Gunn, who is also known as “Classified,” allegedly branded his prostitutes with tattoos of his moniker to mark his “stable” of sex workers.
The investigation into Gunn began in February when the 16-year-old victim was traced to a Moreno Valley motel, where authorities discovered five victims who were working for Gunn – three of whom were minors. Several of the victims had tattoos that read “Classified,” including the 16-year-old victim, who had the tattoo over her right eye.
The investigation showed that the victims had placed advertisements for commercial sex acts on Backpage.com and that Gunn had about a dozen women and girls working for him. One of the victims had posted hundreds of ads for sex services in states as far away as Alaska and Minnesota, according to the affidavit in support of the criminal complaint. Several victims told authorities that Gunn took all of the money they collected from customers, with one victim using a wire transfer service to send more than $17,000 to Gunn over the course of three months.
“Every day, human trafficking victimizes large numbers of women and children, causing victims physical harm and long-lasting emotional trauma,” said United States Attorney Eileen M. Decker. “This case demonstrates that law enforcement has adopted a new approach that views the women and children as crime victims, but we will continue to aggressively prosecute their traffickers.”
A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
The charge of child sex trafficking carries a mandatory minimum sentence of 10 years in federal prison and statutory maximum sentence of life.
This case was investigated by the Riverside County Anti-Human Trafficking Task Force, which include representatives from the Riverside County Sheriff’s Department and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI). The Moreno Valley Police Department, the San Bernardino County Sherriff’s Office, the Los Angeles County Sheriff’s Department and the Los Angeles Police Department assisted in the investigation.
“Forcing anyone, much less a child, to prostitute themselves under the constant threat of physical harm is not only criminal – it is morally reprehensible,” said Joseph Macias, special agent in charge for HSI Los Angeles. “That what amounts to modern slavery occurs here in our communities in the 21st century is inconceivable. HSI is committed to working with our law enforcement partners to ensure that those involved are held accountable for their crimes.”
This case is being prosecuted by Assistant United States Attorney Tritia L. Yuen of the Riverside Branch Office.
Albuquerque Man Sentenced to Five Years for Violating Federal Firearms and Drug Trafficking LawsRead the Press Release
ALBUQUERQUE – Angelo Burdex, 29, of Albuquerque, N.M., was sentenced today in federal court to 60 months in prison for violating federal firearms and drug trafficking laws. Burdex will be on supervised release for ten years after completing his prison sentence.
Burdex and his co-defendant Desmirk Sharber, 25, also of Albuquerque, were charged in separate criminal complaints in Nov. 2015, with conspiracy and distribution of crack cocaine in Oct. and Nov. 2015, in Bernalillo County, N.M. According to court documents, Burdex and Sharber distributed approximately 58 grams of crack cocaine to undercover law enforcement agents on Oct. 2, 2015.
Burdex and Sharber were subsequently indicted on Nov. 17, 2015, and charged with conspiracy to distribute crack cocaine from Oct. 2, 2015 through Nov. 2, 2015, and distribution of crack cocaine on Oct. 2, 2015 and Nov. 2, 2015. Sharber was individually charged with carrying a firearm in relation to a drug trafficking crime on Nov. 2, 2015. According to the indictment, the offenses took place in Bernalillo County.
On Aug. 26, 2016, Burdex pled guilty to an information charging him with possession of crack cocaine with intent to distribute on Oct. 2, 2015.
On July 22, 2016, Sharber pled guilty to an information charging him with distribution of crack cocaine on Nov. 2, 2015. At sentencing, Sharber faces a maximum penalty of 20 years in federal prison. A sentencing hearing has yet to be scheduled.
This case was investigated by the Albuquerque office of the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Norman Cairns is prosecuting the case.
29 November 2016
Youngsville man pleads guilty to distributing, possessing child pornographyRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced today that a Youngsville man pleaded guilty to distribution and possession of child pornography.
Thomas Hanes, 48, of Youngsville, La., pleaded guilty before U.S. Magistrate Judge Patrick Hanna to one count of distribution and one count of possession of child pornography. The plea will become final when accepted by U.S. District Judge Patricia Minaldi. According to the guilty plea, Hanes was identified through an investigation as distributing thousands of files of child pornography using an online peer-to-peer network. Law enforcement agents searched his home in Youngsville on February 26, 2016 and found sexually explicit images of children as young as two and three years of age on electronic media.
Hanes faces five to 20 years in prison for the distribution count and up to 20 years in prison for the possession count. He also faces five years to life of supervised release, forfeiture of items that were seized during the investigation and a $250,000 fine. Additionally, Hanes is required to register as a sex offender. A sentencing date of March 9, 2017 was set.
Homeland Security Investigations, Louisiana State Police and the Youngsville Police Department investigated the case. Assistant U.S. Attorney Jamilla A. Bynog is prosecuting the case.
This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The U.S. Department of Homeland Security and U.S. Immigration & Customs Enforcement (ICE) also encourage the public to report suspected child predators and any suspicious activity through its toll-free hotline at (866) 347-2423. Investigators are available at all hours to answer hotline calls. Tips or other information can also be submitted to ICE online by visiting their website at www.ice.gov/exec/forms/hsi-tips/tips.asp or through the Operation Predator smartphone application www.ice.gov/predator/smartphone-app. Tips may be submitted anonymously.
Worley Man Pleads Guilty to AssaultRead the Press Release
COEUR D’ALENE – Brian Eugene Sczenski, 32, of Worley, Idaho, pleaded guilty yesterday to assault with the intent to commit robbery, U.S. Attorney Wendy J. Olson announced. Sczenski was indicted by a federal grand Jury in Coeur d'Alene on June 21, 2016.
According to the plea agreement, Sczenski admitted on April 18, 2016, the victim returned home to see Sczenski driving away from his home on the victim's 2016 utility task vehicle (UTV). The victim jumped on his 2010 UTV and chased Sczenski. Because the victim took a different route, he was able to meet up with Sczenski. The victim got out of his UTV and approached Sczenski. Sczenski hit the victim in the face with a closed fist. The victim was briefly knocked out. When the victim awoke, he saw Sczenski driving away on his 2010 UTV.
The charge of assault with the intent to commit robbery is punishable by up to 10 years in prison, a maximum fine of $250,000, and up to 3 years of supervised release.
Sentencing is set for March 7, 2017, before Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Coeur d'Alene.
The case was investigated by Coeur d’Alene Tribal Police and the Federal Bureau of Investigation.
Wilkes-Barre Man Guilty of Straw Purchase of FirearmRead the Press Release
WILKES-BARRE - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Ruben Rosario, age 19, of Wilkes-Barre, pleaded guilty today before United States Magistrate Judge Joseph F. Saporito, Jr., in Wilkes-Barre, to the charge of making false statements to a federally licensed firearm dealer.
According to United States Attorney Bruce D. Brandler, Rosario admitted that he and another individual provided false information regarding the purchase of a semi-automatic .22 caliber pistol from Piestrak’s Gun Shop, LLC, in Nanticoke, Pennsylvania, on April 5, 2016. Rosario paid another individual to purchase the firearm for him and to falsify the paperwork in connection with the sale.
Rosario will appear for sentencing before United States Senior District Judge Richard P. Conaboy in Scranton on a date which has not yet been scheduled.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant United States Attorney Robert J. O’Hara is prosecuting the case.
This case was brought as part of the Violent Crime Reduction Partnership (“VCRP”), a district wide initiative to combat the spread of violent crime in the Middle District of Pennsylvania. Led by the United States Attorney’s Office, the VCRP consists of federal, state and local law enforcement agencies whose mission is to locate, apprehend, and prosecute individuals who commit violent crimes with firearms.
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 the offense is ten years’ 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.
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United States Attorney’s Office for the District of Vermont Announces Hiring of New Attorney to Focus on Civil RightsRead the Press Release
United States Attorney Eric Miller announced today that Julia Torti has joined the United States Attorney’s Office for the District of Vermont as an Assistant United States Attorney in the Office’s Civil Division. Ms. Torti, who grew up in Vermont and is returning after starting her career at a civil rights law firm in New York, is one of thirty-four new Assistant United States Attorneys joining U.S. Attorney’s Offices across the country and focusing on enforcement of the nation’s federal civil rights laws. The Department of Justice created these new positions to increase and improve the United States Attorney’s Offices’ ability to apply dedicated resources to civil rights enforcement in all corners of the country. With the support of Vermont’s civil rights advocates and elected officials, the United States Attorney’s Office for the District of Vermont was awarded one of the thirty-four new positions through a competitive application process.
Since 2010, the United States Attorney’s Office for the District of Vermont has developed a civil rights program through community outreach, education, and case work. It has investigated and resolved numerous civil rights cases involving disability discrimination. The Chief of the Civil Division of the United States Attorney’s Office, Nikolas Kerest, noted, “The addition of a new Assistant United States Attorney concentrating in this area will significantly increase the Office’s ability to reach and to protect the civil rights of Vermonters.”
“Aggressive protection of the civil rights of the residents of Vermont is a top priority for the Department of Justice,” said U.S. Attorney Miller. “The Department and this U.S. Attorney’s Office are committed to a level playing field for all Vermont residents, promoting equal opportunity for Vermonters, and educating the public about their rights and responsibilities under federal civil rights laws. Being selected to receive one of the thirty-four new civil rights AUSA positions and having Assistant United States Attorney Torti join us are great steps toward achieving those goals.”
“Now, more than ever, it is crucial that we have the resources in Vermont and in other states to investigate and prosecute civil rights violations. I commend U.S. Attorney Eric Miller and his team for their hard work in securing this position for Vermont, and I was gratified to be in a position to support their efforts,” said Senator Patrick Leahy, D-Vt., the ranking member of the Senate Judiciary Committee. “As Vermont’s population becomes more diverse, we will continue to work to assure that no one faces discrimination based on the color of their skin, their identified gender or sexual orientation, their disability or their religious beliefs. I am proud that our small state is committed to upholding these basic human rights because all Vermonters deserve to be treated with dignity and fairness.”
Also joining the United States Attorney’s Office for the District of Vermont and working towards the protection of the civil rights of Vermonters will be a contract Civil Rights Intake and Outreach Coordinator. This contractor will be collaborating with Assistant United States Attorney Torti and local community members, advocacy groups and other federal and state agencies to promote education and protection of Vermonters’ civil rights.
Curtiss Reed, Jr., the Executive Director of the Vermont Partnership for Fairness and Diversity, added, "Vermont Partnership for Fairness & Diversity applauds the staff additions to the office of the United States Attorney for the District of Vermont at a time when many Vermonters feel vulnerable to acts of discrimination, denial of services, and hate crimes. We look forward to working with Ms. Torti and her colleagues to defend and strengthen civil rights for all Vermonters.”
Federal civil rights laws, among other things, prohibit discrimination and harassment on the basis of race, national origin, gender, religion and disability; prohibit hate crimes; prohibit police misconduct; protect the constitutional rights of institutionalized persons; protect the employment rights of service members; and prohibit discrimination in housing and mortgage lending. For more information on the Department of Justice’s civil rights effort, please visit www.justice.gov/crt.
U.S. Attorney Settles Religious Discrimination Lawsuit Against City of Port JervisRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that the United States has settled a federal civil rights lawsuit against the CITY OF PORT JERVIS (“PORT JERVIS”) in Orange County, New York. Under the agreed-upon Consent Decree, PORT JERVIS will repeal a local law enacted in December 2015 that bans places of worship from two of the City’s central business and commercial zoning districts. The Consent Decree also provides that the lawsuit can be reinstated if Port Jervis fails to amend its zoning laws to comply with federal law prohibiting discrimination and unreasonable impositions on religious freedom by January 23, 2017. The Consent Decree was entered on November 23, 2016, by U.S. District Judge Kenneth M. Karas.
U.S. Attorney Preet Bharara said: “With this lawsuit and consent decree requiring the City of Port Jervis to repeal or amend a local law that banned places of worship in two of its central business districts, we help to ensure free religious exercise in the city.”
According to the Complaint, filed in federal court in White Plains on November 21, 2016:
PORT JERVIS violated the Religious Land Use and Institutionalized Persons Act (“RLUIPA”) by passing a local law in December 2015 that banned the use of land for purposes of places of worship in two of Port Jervis’s main commercial and business zones, the Central Business District and the Service Commercial District. Prior to the passage of the local law, use of land for these purposes was permitted as of right in these districts. While City officials claimed that the local law was justified by concerns relating to parking, commercial development, and liquor licensing, PORT JERVIS continues to permit nonreligious uses in these areas that will have similar effects. Accordingly, the Complaint charged that PORT JERVIS treated religious assemblies on unequal terms with comparable nonreligious assemblies or institutions, in violation of RLUIPA.
Moreover, PORT JERVIS substantially burdened the religious exercise of the Goodwill Evangelical Presbyterian Church (the “Church”), which had sought to establish a place of worship in PORT JERVIS’s Central Business District. After the Church was in contract to purchase property in that district and had received assurances from City officials that it could use the property as a branch of the Church, PORT JERVIS adopted the local law to ban places of worship in the zoning district. The local law precluded the Church from its intended use of the property for religious exercise and caused the Church to suffer delay and expense in establishing a permanent place of worship in the City. The Complaint charged that PORT JERVIS substantially burdened the Church’s religious exercise, also in violation of RLUIPA.
Pursuant to the Consent Decree entered on November 23, 2016, PORT JERVIS has until January 23, 2017, to repeal the local law banning places of worship from two of its central zoning districts. PORT JERVIS also has agreed not to treat religious assemblies or institutions on unequal terms with nonreligious assemblies or institutions, and not to implement any land use regulation in a manner that imposes a substantial burden on the religious exercise of any person, assembly, or institution. PORT JERVIS has further agreed to comply with certain notice, training, and recordkeeping requirements to ensure that City officials are knowledgeable about and comply with RLUIPA, and to allow the Government to monitor PORT JERVIS’s compliance.
The case is being handled by the Office’s Civil Rights Unit. Assistant United States Attorney Samuel Dolinger is in charge of the case.
Two men sentenced for drug distributionRead the Press Release
WHEELING, WEST VIRGINIA – Two men were sentenced in federal court today for heroin, cocaine, and crack cocaine distribution charges, United States Attorney William J. Ihlenfeld, II, announced.
Anton Demetrius Matthews, 33, of Cleveland, Ohio, was sentenced to 71 months in prison for distributing crack cocaine on Wheeling Island near Madison Elementary School. He pled guilty to one count of “Distribution of Cocaine Base Within 1,000 Feet of a Protected Location.”
Mark Louis Flint, 31, of Cleveland, Ohio, was sentenced to 30 months in prison for distributing heroin and cocaine in Ohio County, West Virginia in October 2015. He pled guilty to one count of “Conspiracy to Possess with Intent to Distribute and to Distribute Schedule I and Schedule II Controlled Substances.”
Assistant U.S. Attorney David J. Perri prosecuted the Matthews case and Assistant U.S. Attorney Randolph J. Bernard prosecuted the Flint case on behalf of the government. The Ohio Valley Drug and Violent Crime Task Force, a HIDTA-funded initiative, investigated.
U.S. District Judge John Preston Bailey presided.
Two Texas County Men Sentenced for Meth ConspiracyRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that two Texas County, Mo., men have been sentenced in federal court for their roles in a drug-trafficking conspiracy.
Michael D. Strong, 41 of Cabool, Mo., was sentenced today by U.S. District Judge M. Douglas Harpool to 10 years in federal prison without parole. Co-defendant Carl H. Amburn, Jr., 41, of Raymondville, Mo., was sentenced on Monday, Nov. 28, 2016, to 10 years in federal prison without parole.
Strong and Amburn each pleaded guilty to their roles in a conspiracy to distribute methamphetamine in Greene and Texas counties from July 22, 2014, to April 1, 2015. Co-defendant Angela C. Howell, 39, of Cabool, has also pleaded guilty to participating in the drug-trafficking conspiracy and is scheduled to be sentenced on Dec. 7, 2016.
Law enforcement officers executed a search warrant at Amburn’s residence on April 1, 2015. They seized several small plastic bags containing methamphetamine, some or all of which Amburn admitted he intended to distribute to other persons. The plastic bags contained a total of 7.61 grams of pure methamphetamine.
Strong and Howell admitted that they distributed approximately 34.03 grams of methamphetamine (which contained 8.94 grams of pure methamphetamine) to another person in Greene County on July 22, 2014.
This case is being prosecuted by Assistant U.S. Attorney Timothy A. Garrison. It was investigated by the South Central Drug Task Force, the Missouri State Highway Patrol, the Texas County, Mo., Sheriff’s Department and the Dent County, Mo., Sheriff’s Department.
Two Sentenced for Firearms TraffickingRead the Press Release
LAREDO, Texas – A Laredo man and a female Mexican national have been ordered to federal prison for their roles in the trafficking of firearms, announced U.S. Attorney Kenneth Magidson.
Claudia Raquel Herrera-Ibarra, 35, of Nuevo Laredo, Mexico, and Jonathan James Ruiz, 24, of Laredo, pleaded guilty July 14, 2016. Herrera-Ibarra admitted to possession of firearms by an illegal alien, while Ruiz entered a plea to making false statements in connection with the purchase of firearms.
Following a hearing late yesterday, U.S. District Judge Marina Garcia Marmolejo ordered Ruiz and Herrera-Ibarra to serve 60 and 84 months in prison, respectively. At the hearing, Herrera-Ibarra asked the court for a lower sentence, claiming she was a minor participant who took orders from cartel members in Mexico. Judge Marmolejo noted that Herrera-Ibarra had recruited others to buy firearms for her and demonstrated a high level of sophistication in her operation. The court further commented that the acts of both defendants directly affected the citizens of Mexico as well as the people of the United States. Ruiz will also serve three years of supervised release following his prison term, while Herrera-Ibarra is expected to face deportation proceedings following her sentence.
Both defendants had previously admitted to unlawfully conspiring with each other and others to fraudulently and knowingly acquire assault rifles and pistols for illegal export from the United States to Mexico. Herrera-Ibarra hired Ruiz and others to purchase civilian versions of military assault rifles and pistols between Dec. 13, 2015, and March 19, 2016, from various firearms stores in Laredo. She then illegally smuggled or hired others to smuggle the firearms to associates in Mexico who solicited the firearms. These associates were primarily members of the Los Zetas criminal organization operating in Mexico.
Herrera-Ibarra paid Ruiz between $150 and $400 for buying each firearm. Ruiz admitted he ultimately bought 25 firearms for her and that he had falsely certified on each firearms form that he was the actual purchaser of the weapons.
Herrera-Ibarra was arrested April 1, 2015, in the parking lot of a sporting goods store in north Laredo after receiving two AR-15 semi-automatic rifles from an undercover agent whom she had hired and paid to buy the firearms. Herrera-Ibarra acquired at least 27 firearms which she exported illegally to Mexico. At least two firearms were intercepted during this investigation prior to being exported to Mexico.
Herrera-Ibarra has been and remains in federal custody. Ruiz was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined at a later date.
Omar Rolando Castillo, 30, another co-conspirator named in a separate indictment, has also pleaded guilty and is pending sentencing before U.S. District Judge Diana Saldaña.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation with the assistance of the Laredo Police Department and Webb County Sheriff’s Office. Several local officers and deputies have been cross-designated as task force officers working directly with federal agencies, assisting in the investigation of these and other crimes. Assistant U.S. Attorney Jose Homero Ramirez is prosecuting the cases.