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Friday 30 September 2016
United States Attorney and Lexington Police Chief Announce New Partnership in Fight Against Opiate EpidemicRead the Press Release
Partnership focuses on more training for investigators, more prosecutions of high-level dealers, and intervention.
LEXINGTON, Ky. — U.S. Attorney Kerry B. Harvey, the Drug Enforcement Administration (DEA), and Lexington Police Chief Mark Barnard jointly announce a new initiative aiming to implement a comprehensive approach to central Kentucky’s opioid epidemic.
As part of the plan, the Lexington Police have added officers to its narcotics unit with an enhanced focus on investigating overdose cases. Certain of these officers will exclusively investigate overdose cases, that result in either death or serious bodily injury, in conjunction with the U.S. Attorney’s Office’s overdose prosecution initiative. That initiative focuses on prosecuting dangerous drug dealers and their suppliers, who distribute heroin, fentanyl and other opioids that cause overdoses, under a federal statute that imposes a mandatory minimum of 20 years in prison and up to life imprisonment upon conviction. Prosecutors with the U.S. Attorney’s Office and officers of the Lexington Police Department will jointly train on best practices in the investigation and prosecution of overdose cases.
Beginning this month, Lexington Police are carrying naloxone, a life-saving medication used to revive individuals who have overdosed on opioids such as oxycodone, heroin or fentanyl. The new initiative plans to provide treatment information to survivors of an overdose who suffer from addiction. The Lexington Police Department is currently working with the City’s Substance Abuse and Violence Intervention program to identify medical providers and recovery specialists who can partner in this initiative.
“Kentucky’s opioid epidemic requires an all hands on deck approach,” said U.S. Attorney Harvey. We must make central Kentucky an inhospitable environment for drug dealers and their suppliers. Our deepening partnership with the Lexington Police is a potential game changer in combatting this scourge in our community. Prosecutions alone cannot solve this problem, however, and we must create partnerships that make effective, affordable addiction treatment available to those in need on a timely basis. Prevention and education efforts must be intensified as well. I applaud Chief Barnard’s leadership on this issue, and look forward to working closely with him as we convene community stakeholders in order to devise innovative responses to this threat.”
“We have nearly doubled the number of personnel assigned to our Narcotics Enforcement Unit because the problem we’re seeing in our community is that significant,” Chief Barnard said. “Two detectives focus specifically on overdose cases. The goal is to track down drug dealers who are preying on individuals suffering from addiction and destroying families, while also making sure victims are connected with the resources they need to get help.”
United States Announces Settlement of Clean Water Act Violations at Aqueduct RacetrackRead the Press Release
Robert L. Capers, United States Attorney for the Eastern District of New York, and Judith A. Enck, Regional Administrator, United States Environmental Protection Agency (EPA) Region 2, announced today the filing of a complaint against The New York Racing Association, Inc. (NYRA) as well as the lodging of a consent decree to resolve the allegations in the complaint.
The complaint alleges that NYRA, which operates the Aqueduct Racetrack where horse racing, training, and boarding of horses occur, and where up to 450 horses are housed on site during the horse racing season, violated the Clean Water Act as a result of discharging polluted wastewater, containing animal wash water and detergent, and feed waste, from Aqueduct Racetrack into New York City’s and New York State’s storm sewer systems. In 2013 and 2014 alone, NYRA generated and discharged an estimated 1.26 million gallons per year of polluted wastewater to storm sewer systems. The discharges from Aqueduct ultimately flowed to the Hawtree and Bergen Basins, tributaries located within the eastern portion of Jamaica Bay, a navigable water of the United States. Eastern Jamaica Bay and associated tributaries are currently designated by the New York State Department of Environmental Conservation as impaired due to ammonia, nitrogen, oil/grease, and pathogens.
Under the consent decree, NYRA will implement measures to eliminate discharges to the storm sewers and ensure that all polluted wastewater from Aqueduct Racetrack flows to sanitary sewers. The settlement includes interim and long term measures, including (1) designation of an employee who is responsible for ensuring that there are no discharges of polluted wastewaters into storm drains; (2) implementation of procedures applicable to employees to ensure that no polluted wastewater discharges occur; (3) installation and operation of a telemetry monitoring system in the manholes that will alert employees of any dry weather flows in the storm sewers; and (4) weekly inspections. The settlement also requires NYRA to implement horse washing procedures and to implement a public website that makes inspection results and information about NYRA’s compliance available to the public. The Consent Decree also requires NYRA to pay $150,000 as a civil penalty.
In addition, the Consent Decree requires NYRA to implement a Supplemental Environmental Project to reduce storm water runoff impacts. NYRA will plant 62 trees at the nearby NYRA Belmont Racetrack which will (1) capture storm water enabling some of it to evaporate back to the atmosphere rather than reach the ground; (2) mitigate the effect of heavy storm events (i.e., large amounts of runoff) by intercepting and slowing the rate at which storm water reaches the ground; (3) break up the soil to allow the soil to become more permeable and able to absorb greater amounts of storm water; and (4) abate soil erosion. The trees will also provide wildlife habitat and reduce urban “heat island” effects.
Aqueduct Racetrack is a concentrated animal feeding operation (CAFO). EPA defines a CAFO as a facility where animals are kept and raised in confined situations for a total of 45 days or more in any 12-month period and feed is brought to the animals rather than the animals grazing or otherwise feeding in pastures, fields, or on range land. CAFOs generate significant volumes of animal waste which, if improperly managed, can result in environmental and human health risks such as water quality impairment, fish kills, algal blooms, contamination of drinking water sources, and transmission of disease-causing bacteria and parasites associated with food and waterborne diseases. This action was brought as part of EPA’s National Enforcement Initiative that uses innovative monitoring and targeting techniques to identify areas where CAFOs impair our nation’s natural resources or adversely impact communities, and to promote technologies to address excess nutrients and reduce animal waste pollution.
“The United States brought this action to ensure that the polluted wastewater discharges that flow from Aqueduct Racetrack and through storm sewers to Jamaica Bay are eliminated. Jamaica Bay is an important habitat for fish, wildlife, migratory birds, and plants. This office will continue to vigorously enforce violations of the Clean Water Act to reduce pollution to this and other waters of the United States,” said United States Attorney Capers.
“Over a million gallons of polluted wastewater has been released every year from the Aqueduct Racetrack into Jamaica Bay, including animal wash water and detergent, and feed waste,” said EPA Regional Administrator Enck. “It is imperative that the New York Racing Association comply with the federal Clean Water Act.”
The action is entitled United States v. The New York Racing Association, Inc., Civil Action No. 1:16-CV-05442-LDH-CLP, (DeArcy Hall, J.), (Pollak, M.J.). Following a 30-day comment period and review of any comments received, the United States will determine whether to move to enter the consent decree.
Assistant United States Attorney Deborah B. Zwany is in charge of the litigation, with assistance from Phyllis Kaplan Feinmark, Chief, Water and General Law Branch, EPA Region 2, Kimberly McEathron, Physical Scientist, Water Compliance Branch, EPA Region 2, Kathryn J. Greenwald, Environmental Protection Specialist, EPA Office of Enforcement and Compliance Assurance, and Kristin Buterbaugh, Attorney-Adviser, EPA Office of Enforcement and Compliance Assurance.
U.S. Attorney’s Office for the Southern District of Florida Joins Law Enforcement Partners to Support National Community Policing Week, October 3-7, 2016Read the Press Release
The United States Attorney’s Office for the Southern District of Florida is committed to supporting and promoting strong relationships between law enforcement and the individuals, families and communities we serve and protect every day. Community policing – public safety efforts built on resilient bonds of mutual trust and respect between local police officers and neighborhood residents – is an essential component of law enforcement work. Community policing is a fundamental part of the public safety mission shared by our law enforcement partners, local community leaders, and youth advocates. In support of this mission, October 3-7, 2016, had been designated as the inaugural National Community Policing Week.
During Community Policing Week, the U.S. Attorney’s Office, law enforcement, community organizations, stakeholders and concerned citizens, will come together to host and participate in events and engagement activities that support our commitment to effective and impactful community policing. Members of the community are invited and encouraged to participate. Our collective efforts will continue to help us make our diverse, vibrant local neighborhoods safer, stronger, and more united.
“Throughout the upcoming week, you will see that by bringing together law enforcement and the communities we protect, we are breaking down barriers, bridging divides, building trust and working toward universal support and respect,” stated U.S. Attorney Wifredo A. Ferrer for the Southern District of Florida. “We encourage you to join our efforts and become part of the solution, as we unite to make our South Florida community safer and more resilient.”
Throughout the week, our partners in the Southern District of Florida will host a variety of Community Policing events, including:
Youth and Cops Basketball Tournament: On Monday, October 3, 2016, an all-day Youth and Cops Basketball Tournament will be held at the Betty T. Ferguson Recreational Complex, located at 3000 NW 199th St, Miami Gardens, FL 33056. Teams made up of local youth (ages 12 to 17) and law enforcement officers will come together for the friendly competition.
Local Children Will Be Police Chiefs for A Day: Throughout the week, participating law enforcement agencies will invite a child from the local community to shadow the Police Chief for the day. The children will experience “a day in the life of law enforcement” by participating in activities that include: roll call, tours of the dispatch areas, community patrol, mock crime scene scenarios, management meetings, and K-9 patrol reviews.
Coral Gables Police Department
Coral Springs Police Department
Doral Police Department
Golden Beach Police Department
Lauderhill Police Department
Margate Police Department
Medley Police Department
Miami-Dade Police Department
Miami-Dade Schools Police Department
Miami Gardens Police Department
Miami Police Department
Miami Springs Police Department
Seminole Police Department
Sunny Isles Beach Police Department
Sunrise Police Department
Surfside Police Department
National Night Out Events: -- During National Night Out events, citizens who benefit from the hard work and dedication of our police forces are encouraged to join in the fight against crime. Law enforcement cannot combat crime without the help of the community and, now more than ever, they need the support of the communities they protect and serve. National Night Out events heighten crime and drug prevention awareness, generate support for and participation in local anticrime efforts, strengthen neighborhood spirit and police-community partnerships, and send a message to those who victimize and poison our communities with their criminal conduct that South Florida residents are taking back their neighborhoods. The events are typically organized by block watches, non-for-profit organizations, companies, and police departments. These events can be as simple as backyard cookouts to full-blown festivals. Police Departments, including those listed below, will be holding National Night Out events during Community Policing week:
Coral Gables Police Department October 4th
South Miami Police Department - October 4th
West Miami Police Department - October 4th
Palm Beach Gardens Police Department - October 7th
Community Resource Fair and Freed Food Distribution Program: On Thursday, October 6, 2016, a Community Resource Fair and Farm Share Free Food Distribution Program will be held from 10:00 a.m. to 2:00 p.m. at the Phichol Williams Community Center, located at 951 SW 4th Street, Homestead, FL 33030. The program is being held in collaboration with the Homestead Police Department.
For more information regarding National Community Policing Week and to learn how you can get involved with local programming, please call (305) 961-9134 or visit [email protected].
U.S. Attorney's Office Concludes Investigation into Fatal Shooting at Union StationRead the Press Release
WASHINGTON - The U.S. Attorney’s Office for the District of Columbia announced today that it has completed its review of the fatal shooting of Rashad Bugg-Bey by an off-duty Baltimore County, Md. Police Department officer on Nov. 14, 2015, at Union Station. After a careful review of all of the evidence, the U.S. Attorney’s Office has concluded that there is insufficient evidence to pursue federal criminal civil rights or District of Columbia charges against the officer involved in the fatal shooting of Mr. Bugg-Bey.
The U.S. Attorney’s Office for the District of Columbia and the Metropolitan Police Department (MPD) conducted a comprehensive review of the incident, which included interviews of law enforcement and civilian witnesses and assessing photographs, video footage, diagrams, physical evidence, recorded radio communications, the autopsy report, and other evidence.
According to the evidence, the shooting took place Nov. 14, 2015, at approximately 8:15 p.m. Mr. Bugg-Bey, 25, and a female relative were at Union Station, 50 Massachusetts Avenue NE. They were on the lower Metro level, when Mr. Bugg-Bey inexplicably pulled out a large kitchen knife and slashed his relative’s face. Bleeding, she began to flee Union Station.
The Baltimore County officer, who was off-duty and with a friend, had just entered Union Station through a lower-level entrance to Metro when he saw a woman, who was screaming and running toward the exit. The officer continued walking toward the escalator that leads from the Metro level into Union Station when he observed Mr. Bugg-Bey a few feet from the escalator, armed with a butcher knife. The officer and his friend stepped onto the escalator.
Mr. Bugg-Bey, still armed with the knife, also got on the escalator. He pointed the knife in the direction of the off-duty officer and his friend. The off-duty officer identified himself as a police officer and gave Mr. Bugg-Bey numerous commands to drop his weapon, but Mr. Bugg-Bey refused to comply. Mr. Bugg-Bey continued to ascend the elevator with the knife raised in a manner that the officer and several witnesses described as threatening and menacing.
According to the evidence, the officer discharged his weapon after Mr. Bugg-Bey failed to drop his knife and had almost reached the top of the escalator. In between discharging rounds, the officer continued to give Mr. Bugg-Bey commands to drop the knife. If Mr. Bugg-Bey had exited the escalator while still armed, he would have had access to additional civilians located in the boarding areas of Union Station as well as the area for shopping and restaurants.
Mr. Bugg-Bey was taken to a hospital with gunshot wounds to his head and hand. He was released from the hospital on Dec. 11, 2015. He died on Dec. 22, 2015 as a result of his injuries from the shooting.
After a careful, thorough, and independent review of the evidence, federal prosecutors have found insufficient evidence to prove beyond a reasonable doubt that the officer used excessive force under the circumstances.
Use-of-force investigations generally
The U.S. Attorney’s Office reviews all police-involved fatalities to determine whether sufficient evidence exists to conclude that any officers violated either federal criminal civil rights laws or District of Columbia law. To prove such violations, prosecutors must typically be able to prove that the involved officers willfully used more force than was reasonably necessary. Proving “willfulness” is a heavy burden. Prosecutors must not only prove that the force used was excessive, but must also prove, beyond a reasonable doubt, that the officer acted with the deliberate and specific intent to do something the law forbids. A conclusion that “there is insufficient evidence” is not meant to suggest anything further about what evidence, if any, exists.
The U.S. Attorney’s Office remains committed to investigating allegations of excessive force by law enforcement officers and will continue to devote the resources necessary to ensure that all allegations of serious civil rights violations are fully and completely investigated. The Metropolitan Police Department’s Internal Affairs Division investigates all police-involved fatalities in the District of Columbia.
Two Maryland MS-13 Members Convicted in Racketeering Conspiracy Including MurderRead the Press Release
A federal jury today convicted two Hyattsville, Maryland, men on charges related to the racketeering enterprise activity of a gang known as La Mara Salvatrucha, or MS-13.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; U.S. Attorney Rod J. Rosenstein of the District of Maryland; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Baltimore Field Office; Chief Hank Stawinski of the Prince George’s County, Maryland, Police Department; Chief J. Thomas Manger of the Montgomery County, Maryland, Police Department; Prince George’s County State’s Attorney Angela D. Alsobrooks; and Montgomery County State’s Attorney John McCarthy.
Eric Antonio Mejia-Ramos, aka Flaco, 22, and Miguel Angel Manjivar, aka Masflow and Garra, 25, were both found guilty of conspiracy to participate in a racketeering enterprise by a federal jury sitting in U.S. District Court for the District of Maryland. In addition, Manjivar was found guilty of murder in aid of racketeering. U.S. District Judge Roger W. Titus of the District of Maryland scheduled sentencing for Mejia Ramos on Jan. 5, 2017, and Manjivar on Jan. 23, 2017.
MS-13 is a national and transnational gang composed primarily of immigrants or descendants from El Salvador. Branches or “cliques” of MS-13, one of the largest street gangs in the United States, operate throughout Prince George’s County and Montgomery County. MS-13 members are required to commit acts of violence to maintain membership and discipline within the gang. One of the principal rules of MS-13 is that its members must attack and kill rivals, known as “chavalas,” whenever possible.
According to evidence presented at trial, from at least 2009 through October 2014, MS-13 members planned and committed numerous crimes, including murders, attempted murders, kidnappings, assaults, robberies and witness tampering and retaliation in Prince George’s and Montgomery Counties. Gang members also extorted brothel operators and owners of other illegal businesses and tampered with and retaliated against witnesses, among other crimes. Mejia-Ramos was a member of the MS-13 Parkview Locotes Salvatrucha Clique and Manjivar was a member of the MS-13 Peajes Locotes Salvatrucha Clique.
Trial evidence showed that on Sept. 16, 2010, Manjivar shot and killed an individual he believed to be a rival gang member on the footbridge of a park in Hyattsville. On Jan. 10, 2011, Manjivar and other MS-13 members murdered a person they believed was a rival gang member and attempted to murder another purported rival gang member in a parking lot in Hyattsville. Manjivar and others repeatedly punched, kicked and stabbed the victims, one of whom survived the attack.
In addition, trial evidence demonstrated that on Jan. 13, 2011, Manjivar attended a Peajes Clique meeting, where he criticized other MS-13 members for not committing enough violent crimes. Manjivar then left in a mini-van driven by a co-defendant with other Peajes members as passengers, and as a group, they attacked a person they believed to be an associate of a rival gang and dragged him back into the vehicle. Manjivar and others continued to assault him, at times attempting to use a seat belt to strangle the victim, as well as kicked, stabbed and choked him. Trial evidence demonstrated that they forcefully stripped the victim of his heavy winter clothing in order to stab him, and then dragged him into the woods, where they left him for dead and fled. The victim survived the attack.
According to evidence presented at trial, on the night of Aug. 28, 2012, Mejia-Ramos lured a woman he believed to be a rival gang member to a park in Beltsville, Maryland, telling her they were going to party. He then shot the woman to death.
In addition to these convictions, eight of the 13 defendants charged in this investigation have pleaded guilty to their roles in the racketeering conspiracy and two have been convicted.
HSI Baltimore, Prince George’s County Police Department, Montgomery County Police Department, Prince George’s State’s Attorney’s Office and Montgomery County State’s Attorney’s Office investigated the case. Trial Attorney Catherine K. Dick of the Criminal Division’s Organized Crime and Gang Section (OCGS) and Assistant U.S. Attorneys William D. Moomau and Lindsay Eyler Kaplan of the District of Maryland are prosecuting the case. Former OCGS Trial Attorney Kevin Rosenberg assisted in the prosecution of this case.
Two Maryland MS-13 Members Convicted in Federal Racketeering Conspiracy Including MurderRead the Press Release
Greenbelt, Maryland – A federal jury today convicted Eric Antonio Mejia-Ramos, aka “Flaco,” age 22, and Miguel Angel Manjivar, aka “Masflow or “Garra,” age 25, both of Hyattsville, of conspiracy to participate in a racketeering enterprise in connection with their gang activities as members of La Mara Salvatrucha, or MS-13. Manjivar was also found guilty of murder in aid of racketeering.
The convictions were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Chief Hank Stawinski of the Prince George’s County Police Department; Chief J. Thomas Manger of the Montgomery County Police Department; Prince George’s County State’s Attorney Angela D. Alsobrooks; and Montgomery County State’s Attorney John McCarthy.
MS-13 is a national and transnational gang composed primarily of immigrants or descendants from El Salvador. Branches or “cliques” of MS-13, one of the largest street gangs in the United States, operate throughout Prince George’s County and Montgomery County, Maryland. MS-13 members are required to commit acts of violence to maintain membership and discipline within the gang. One of the principal rules of MS-13 is that its members must attack and kill rivals, known as “chavalas,” whenever possible.
According to evidence presented at the three-week trial, from at least 2009 through October 2014, MS-13 members planned and committed numerous crimes, including murders, attempted murders, kidnappings, assaults, robberies, and witness tampering and retaliation in Prince George’s and Montgomery Counties. Gang members also extorted brothel operators and owners of other illegal businesses and tampered with and retaliated against witnesses, among other crimes. Mejia-Ramos was a member of the MS-13 Parkview Locotes Salvatrucha clique and Manjivar was a member of the MS-13 Peajes Locotes Salvatrucha clique.
Trial evidence showed that on September 16, 2010, Manjivar shot and killed an individual he believed to be a rival gang member on the footbridge of a park in Hyattsville. On January 10, 2011, Manjivar and other MS-13 members murdered a person they believed was a rival gang member, and attempted to murder another purported rival gang member, in the parking lot of the former Shoppers Food Warehouse on University Boulevard in Hyattsville. Manjivar and others repeatedly punched, kicked, and stabbed the victims, one of whom survived the attack.
In addition, trial evidence demonstrated that on January 13, 2011, after attending a Peajes clique meeting at which he criticized other MS-13 members for not committing enough violent crimes, Manjivar and other MS-13 Peajes members got into a mini-van driven by a co-defendant. Near the Fort Totten Metro Station, they saw a person they believed was an associate of a rival gang. Manjivar and other MS-13 members attacked the victim and dragged him back into the mini-van. Manjivar and others continued to assault him, at times attempting to use a seat belt to strangle the victim. They eventually parked near a dead end in the vicinity of Chillum Manor Road. Manjivar and others kicked, stabbed and choked the victim. They forcefully stripped the victim of all of his heavy winter clothing in order to stab him. After assaulting the victim near the mini-van, they dragged the victim into the woods, where they left him for dead, and fled. The victim survived the attack.
According to evidence presented at trial, on the night of August 28, 2012, Mejia-Ramos lured a woman he believed to be a rival gang member to a park in Beltsville, telling her they were going to party. At the park, Mejia-Ramos shot the woman to death.
Both defendants face a maximum sentence of life in prison for conspiring to participate in a racketeering enterprise. Manjivar faces a mandatory sentence of life in prison for murder in aid of racketeering. U.S. District Judge Roger W. Titus has scheduled sentencing for Mejia-Ramon on January 5, 2017, and for Manjivar on January 23, 2017. Mejia-Ramos and Manjivar remain detained
In addition to these convictions, eight of the 13 defendants charged in this case have previously pleaded guilty to their roles in the racketeering conspiracy and two have been convicted after trial.
United States Attorney Rod J. Rosenstein commended HSI Baltimore, Prince George’s County and Montgomery County Police Departments, and Prince George’s and Montgomery County State’s Attorney’s Offices for their work in the investigation and prosecution. Mr. Rosenstein thanked Assistant United States Attorneys William D. Moomau and Lindsay Eyler Kaplan, and Trial Attorney Catherine K. Dick with the Justice Department’s Organized Crime and Gang Section, who are prosecuting the case. Former OCGS Trial Attorney Kevin Rosenberg assisted in the prosecution of this case.
Tulsa Doctor Found Guilty of Health Care FraudRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that STEVEN WILLIAM DELIA, age 61, of Tulsa, Oklahoma, was found guilty of HEALTH CARE FRAUD by a federal jury on Thursday, September 29,2016. The jury also found that the defendant should forfeit $83,769.27 in assets as part of any sentence imposed.
The defendant was indicted in June, 2016 and charged with HEALTH CARE FRAUD, in violation of Title 18, United States Code, Section 1347.
The Indictment alleged that on or about the February 1, 2010, and continuing through November 9, 2010, in the Eastern District of Oklahoma, the defendant, STEVEN WILLIAM DELIA, knowingly and willfully executed and attempted to execute the above-described scheme and artifice to defraud money and property owned by and under the custody and control of the Oklahoma Health Care Authority, a health benefit program as defined in Title 18, United States Code, Section 24(b), in connection with the payment for health care benefits, items and services.
The trial began with testimony on September 26, 2016 and concluded with closing arguments and jury deliberations on Thursday, September 29, 2016.
Testimony at the trial established that DELIA knowingly and willfully, with the intent to defraud, devised and executed a scheme to defraud the Oklahoma Medicaid program by causing the filing of false claims and receiving Medicaid payments for medical services not rendered by a qualified medical professional.
Additional evidence proved that during the time charged in the Indictment, DELIA, in preparation for deployment to Afghanistan, pre-signed approximately 9000 blank prescriptions, for his unsupervised physician’s assistant and nursing staff to disseminate Schedule II narcotics during his absence, from the Delia Medical Clinic in Sallisaw, Oklahoma. A percentage of those office visits and prescriptions were billed to Medicaid, causing the filing of false claims and receiving Medicaid payments for medical services not rendered by a qualified medical professional.
The charges are a result of an investigation by the Defense Criminal Investigative Service and the Department of Health and Human Services – Office of Inspector General.
The Honorable James H. Payne, District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the trial and ordered the completion of a presentence investigation report. The defendant was released on bond pending sentencing.
Assistant United States Attorney’s Melody Nelson represented the United States.
Thai Man Found Guilty of Conspiracy to Violate Arms Export Control Act and International Traffic in Arms Regulations, Involving Significant Amounts of Gun PartsRead the Press Release
WASHINGTON – Pheerayuth Burden, 46, a Thai national who had been living in Torrance, California, was found guilty by a jury today of taking part in a conspiracy involving the purchase and shipment of hundreds of gun parts and accessories from the United States to Thailand without a license. His company, Wing–On LLC, also was found guilty of charges.
The verdict was announced by U.S. Attorney Channing D. Phillips and Clark E. Settles, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Washington, D.C.
Following a trial in the U.S. District Court for the District of Columbia, the jury found Burden and Wing-On LLC guilty of one count of conspiracy to violate the Arms Export Control Act and the International Traffic in Arms Regulations, one count of unlawful export of defense articles from the United States, and one count of conspiracy to commit money laundering. The Honorable Rosemary M. Collyer scheduled sentencing for Dec. 15, 2016. She ordered that Burden be placed in custody while awaiting the sentencing hearing.
A co-defendant, Kitibordee Yindeear-Rom, 29, a native and citizen of Thailand, pled guilty to a conspiracy charge in November 2014.
According to the government’s evidence, beginning at least in or about July 2010, Burden, Wing-On, LLC and Yindeear-Rom entered into an agreement to illegally ship United States origin goods, including defense articles - specifically gun parts - to Thailand. As part of their agreement, Yindeear-Rom purchased gun parts from United States manufacturers through on-line purchases, and directed the purchased items to be sent to Burden and Wing-On, which was based in Carson, Calif., to conceal the ultimate destination of the purchases.
Upon receipt of the gun parts, the items would be repackaged for shipment to Thailand. Extending through at least October 2013 as part of the conspiracy, Burden and Yindeear-Rom caused to be purchased and shipped hundreds of different gun parts from the United States to Thailand without a license. These gun parts included, for example, numerous firearm parts, including key components for AR-15 military-style assault rifles.
The jury found that Burden and his company, Wing-On, LLC, acted without a license and in knowing violation of federal export and money-laundering law.
In announcing the verdict, U.S. Attorney Phillips and Special Agent in Charge Settles commended the efforts of the Special Agents who investigated the case for U.S. Immigration and Customs Enforcement, Homeland Security Investigations. They also expressed appreciation for the assistance provided by the State Department’s Directorate of Defense Trade Controls, U.S. Customs and Border Protection, and the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives. They acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Offices, including Assistant U.S. Attorneys Christopher B. Brown, Zia Faruqui, and Michael Friedman; Paralegal Specialists Elana Buruncenco and Jorge Casillas; Victim/Witness Advocates Yvonne Bryant and Tonya Brown, and Litigation Technology Specialists Anisha Bhatia and Josh Ellen. Finally, they commended the work of Assistant U.S. Attorneys Tejpal Chawla and Opher Shweiki, who prosecuted the case.
Stockton Man Pleads Guilty in Credit Card Fraud and Identity Theft SchemeRead the Press Release
SACRAMENTO, Calif. — On Thursday, September 29, 2016, Vuthiya Tim, 31, of Stockton, pleaded guilty to conspiracy to commit credit card fraud and theft of mail matter, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, between March 2014 and September 2015, Tim and eight co-conspirators obtained personal information from victims and used that information to create unauthorized Target credit or debit accounts, called REDcards. They used the Target REDcard account numbers to buy large amounts of electronics, prepaid gift cards, and other goods at Target locations throughout the Sacramento area, Northern California, and elsewhere. In all, more than 300 counterfeit and unauthorized access devices were possessed, used, produced, or trafficked by members of the conspiracy, and over 1,000 victims have been identified to date as having had their identities compromised as a result of the conspiracy.
In addition, Tim pleaded guilty to stealing mail on April 11, 2013, from the post office in Clements, which is in San Joaquin County.
This case is the product of an investigation by the United States Postal Inspection Service and the Stockton Police Department. Assistant United States Attorneys André M. Espinosa and Rosanne L. Rust are prosecuting the case.
Tim is scheduled to be sentenced by U.S. District Judge Troy L. Nunley on December 15, 2016. Tim faces maximum penalties of five years in prison and a $250,000 fine on both counts. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
State Troopers Seize over a Million Dollars’ Worth of Cocaine in Three Separate Traffic StopsRead the Press Release
Montgomery, Alabama – Alabama State Troopers made three recent traffic stops that resulted in the arrest of five individuals and the removal of approximately 40 kilos (88 lbs.) of cocaine off the streets, announced George L. Beck, Jr., United States Attorney for the Middle District of Alabama. The amount of seized cocaine has an estimated street value of $1.3 million.
As of today, all five have been indicted and arraigned in federal court for possessing cocaine with the intent to distribute, or for conspiring to do the same.
According to court documents, on August 22, 2016, Robert Francis Kelly (55), from Pennsylvania, was arrested while traveling through Montgomery County from South Texas in a tractor trailer truck. Kelly was heading towards Georgia when he was pulled over by an Alabama State Trooper. Upon searching Kelly’s truck, Troopers found approximately 15 kilograms of cocaine hidden in a mechanical compartment of the truck.
In a separate incident just two days later, three others were arrested in Opelika, Alabama. Leopoldo Ramos, Jr. (29), from Texas, Octavio Garza Maldanado (40), from Texas, and Jennifer Lynn Everett (30), from Virginia, were traveling in two separate vehicles when they were stopped by Alabama State Troopers. The State Troopers were able to determine that the lead vehicle had recently passed through a Texas border crossing checkpoint and was heading Eastbound towards Georgia. After pulling the vehicles over and searching them, Troopers found approximately 10 kilos of cocaine in a hidden compartment in the lead vehicle’s interior.
In the third event, Nathan Harlan McDermott (41), from Tennessee, was arrested on September 16, 2016 after he was stopped near Hope Hull, Alabama and admitted to traveling from South Texas (near the Mexican Border) to make a cocaine delivery to the Atlanta area. Upon searching McDermott’s tractor trailer, Troopers found approximately 15 kilograms of cocaine hidden in the trailer among the cargo.
At this time, law enforcement does not believe any of the three cases are related. If convicted, each of the individuals charged face prison time ranging from 10 years to life, as well as significant fines and restitution.
An indictment is merely a method of charging an individual with a crime and each defendant is presumed innocent until proven guilty at trial.
These cases are being investigated by the Alabama Law Enforcement Agency’s (ALEA) Highway Patrol Division, the Alabama State Bureau of Investigation (SBI), and the Drug Enforcement Administration (DEA). They are being prosecuted by Assistant United States Attorneys Bradley Bodiford and Curtis Ivy.
State Representative Pleads Guilty to Wire Fraud and Failure to File Federal Income Tax ReturnsRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces that Reginald Fullwood (41, Jacksonville) has pleaded guilty to one count of wire fraud and one count of failure to file federal income tax returns. He faces a maximum penalty of 20 years in federal prison for the wire fraud offense, and a year of imprisonment for the failure to file charge. His sentencing hearing has been set for January 9, 2017.
According to court documents, while Fullwood was seeking election to the Florida House of Representatives, as well as during re-election campaigns, he caused numerous electronic funds transfers from the “Reggie Fullwood Campaign” bank account to a bank account of an entity owned by Fullwood, Rhino Harbor, LLC. Fullwood then used those funds, approximately $65,000 in financial contributions, for personal expenses, including restaurants, grocery stores, retail stores, jewelry stores, florists, gas stations, and liquor stores. To conceal his fraudulent embezzlement of campaign funds, Fullwood submitted or caused to be submitted false and fraudulent campaign expenditure reports to the State of Florida, which included inflated and/or non-existent campaign expenses.
In the State of Florida, a candidate, or the spouse of a candidate, may not use funds on deposit in a campaign account to defray normal living expenses for the candidate or the candidate’s family, other than expenses actually incurred for transportation, meals, and lodging during travel in the course of the campaign.
This case was investigated by Internal Revenue Service – Criminal Investigation and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Mark B. Devereaux and Jason Mehta.
Southern Coal Corporation to Make System-Wide Upgrades to Reduce Water Pollution from Mining Operations in AppalachiaRead the Press Release
The Department of Justice and the U.S. Environmental Protection Agency (EPA) today announced a settlement with Southern Coal Corporation and 26 affiliated mining companies that requires the companies to make comprehensive upgrades to their coal mining and processing operations to prevent discharges of polluted wastewater from their mines in Appalachia. The estimated cost of these measures is $5 million.
The settlement also requires the establishment of a $4.5 million letter of credit and a standby trust that will guarantee sufficient funding for and a mechanism to accomplish, compliance with the Clean Water Act and the work the companies have agreed to perform under the settlement, should the companies fail to do so. The companies will also pay a $900,000 civil penalty, divided among the federal government and the four state co-plaintiffs, Alabama, Kentucky, Tennessee and Virginia.
The settlement resolves alleged violations of state-issued Clean Water Act National Pollutant Discharge Elimination System (NPDES) permits by illegally discharging various pollutants at the companies’ mining and processing operations in Alabama, Kentucky, Tennessee, Virginia and West Virginia and violations of the companies’ legal responsibilities to sample the quality of their discharges to rivers and streams. The estimated annual pollutant reductions through implementation of the settlement is approximately five million pounds.
“This settlement is designed to bring the companies into compliance with the Clean Water Act and requires actions that should prevent future violations,” said Assistant Attorney General John C. Cruden for the Justice Department’s Environment and Natural Resources Division. “We appreciate our state partners working with us on the consent decree and for their joint oversight efforts with us in the future.”
“Discharging pollution from coal mining into waterways is a serious threat to clean water, and that’s why EPA stepped in on behalf communities across Appalachia,” said Assistant Administrator Cynthia Giles for EPA’s Office of Enforcement and Compliance Assurance. “Company-wide compliance programs like the one Southern Coal Corporation will establish are critical to protecting our lakes, rivers and streams and the people who depend on them.”
Under the settlement, Southern Coal Corporation and its affiliated mining companies must implement a series of measures to ensure compliance and prevent future Clean Water Act violations at their coal mining operations, including:
- Implementing a company-wide, EPA-approved environmental management system.
- Maintaining a centralized data management system to track audit results, violations, water sampling data and compliance efforts.
- Constructing a public website for posting documents such as NPDES permits, discharge monitoring reports, water sampling data, effluent violation information, notices of violations and compliance orders.
- Conducting regular internal and independent third-party environmental audits and outlet inspections and undertaking necessary alterations or maintenance measures.
- Providing training for all employees whose responsibilities include environmental compliance and contractors hired to perform duties required by the consent decree.
- Paying a civil penalty of $900,000.
- Paying escalating stipulated penalties if Clean Water Act permit violations continue to occur.
- Providing for a letter of credit and a standby trust and trustee to ensure that there is sufficient money and a mechanism to achieve compliance with the consent decree and the Clean Water Act, if Defendants fail to perform.
The government complaint filed concurrently with the settlement alleged that over the last five years, Southern Coal Corporation mining and processing operations have violated discharge limits for pollutants including iron, total suspended solids, aluminum, pH and manganese in their state-issued permits. The complaint also alleged that Southern Coal Corporation failed to submit complete and timely discharge monitoring reports, made unauthorized discharges and failed to respond to EPA requests for information.
EPA discovered the violations through investigations and inspections of several Southern Coal Corporation mining operations, reviewing various information provided by the companies and coordinating with the affected state governments.
Created in 1972 by the Clean Water Act, the National Pollutant Discharge Elimination System permit program addresses water pollution by authorizing states, with EPA oversight, to issue permits that set strict limits for the discharge of certain types of pollutants by certain types of entities.
The proposed consent decree, lodged in the U.S. District Court for the Western District of Virginia, is subject to a 30-day public comment period and approval by the federal court.
Information about submitting a public comment is available at: www.justice.gov/enrd/consent-decrees.
For more information on this settlement and to read the consent decree, go to: https://www.epa.gov/enforcement/southern-coal-corporation-clean-water-settlement
Sentencings for September 20 - September 28, 2016Read the Press Release
Pablo Ramirez-Andrade, 32, of Mexico, was sentenced by Federal District Court Judge Alan B. Johnson on September 28, 2016, for illegal re-entry of a previously deported alien into the United States. Ramirez-Andrade was arrested in Gillette, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Rogelio Cabrera-Bedolla, 41, of Mexico, was sentenced by Federal District Court Judge Alan B. Johnson on September 28, 2016, for illegal re-entry of a previously deported alien into the United States. Cabrera-Bedolla was arrested in Jackson, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Alton Paul Nelson, 31, of Vanderwagen, New Mexico, was sentenced by Federal District Court Judge Scott W. Skavdahl on September 28, 2016, for failure to register as a sex offender. Nelson was arrested in Delta, Colorado. He received 30 months of imprisonment, to be followed by three years of supervised release, and was ordered to pay a $100.00 special assessment and a $500.00 fine. This case was investigated by the U.S. Marshals Service.
Charles Mathis, 52, of Cheyenne, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on September 28, 2016, for bank robbery. Mathis was arrested in Douglas, Wyoming. He received 77 months of imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and $809.00 in restitution. This case was investigated by the Douglas Police Department, the Converse County Sheriff’s Office and the Federal Bureau of Investigation.
Joseph Tyrell Devries, 33, of Gillette, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on September 27, 2016, for being a felon in possession of a firearm. Devries was arrested in Johnson County, Wyoming. He received 110 months of imprisonment, to be followed by three years of supervised release, and was ordered to pay a $100.00 special assessment. This case was investigated by the Wyoming Highway Patrol and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Luis Enrique Salazar-Benitez, 42, of Sinaloa, Mexico, was sentenced by Federal District Court Judge Alan B. Johnson on September 27, 2016, for conspiracy to distribute 500 grams or more of methamphetamine. Salazar-Benitez was arrested in Casper, Wyoming. He received 135 months of imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and $500.00 in restitution. This case results from an ongoing Organized Crime Drug Enforcement Task Forces (OCDETF) joint investigation conducted by the Campbell County Sheriff’s Office, the Gillette Police Department, the Wyoming Division of Criminal Investigation and the U.S. Drug Enforcement Administration. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
Julio Cesar Munoz-Hernandez, 30, of Mexico, was sentenced by Federal District Court Judge Alan B. Johnson on September 26, 2016, for illegal re-entry of a previously deported alien into the United States. Munoz-Hernandez was arrested in Gillette, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Ricky Lee Capellen, 56, of Riverton, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on September 26, 2016, for conspiracy to distribute at least 500 grams of methamphetamine. Capellen received 120 months of imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and $900.00 in restitution. This case was investigated by the Wyoming Division of Criminal Investigation and the Bureau of Indian Affairs.
Avel Lopez-Perez, a/k/a Ricardo Alvarez, 45, of Mexico, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on September 22, 2016, for illegal re-entry of a previously deported alien into the United States. Lopez-Perez was arrested in Casper, Wyoming. He received 18 months of imprisonment, to be followed by five years of supervised release, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Kwok Lun Chow, 49, of San Francisco, California, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on September 22, 2016, for possession with intent to distribute marijuana. Chow was arrested in Cheyenne, Wyoming. He received 36 months of probation, with the first eight months on home confinement and was ordered to pay a $100.00 special assessment. This case was investigated by the Wyoming Highway Patrol and the Wyoming Division of Criminal Investigation.
Kemp Eugene Cravens, 64, of Casper, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on September 20, 2016, for bank robbery and use and brandish a firearm. Cravens was arrested in Casper, Wyoming. He received 108 months of imprisonment, to be followed by three years of supervised release, and was ordered to pay a $200.00 special assessment, a $500.00 fine and $676.00 in restitution. This case was investigated by the Evansville Police Department, the Casper Police Department, the Natrona County Sheriff’s Office, the U.S. Marshals Service and the Federal Bureau of Investigation.
Second Former UB Student Pleads Guilty to Drug and Money Laundering ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Kevin Szura, 20, of Queens, NY, pleaded guilty to conspiracy to possess with intent to distribute, and distribution of, controlled substances and money laundering conspiracy, before U.S. District Judge Richard J. Arcara. The charges carry a maximum penalty of 20 years in prison and a $1,000,000 fine.
Assistant U.S. Attorney Wei Xiang, who is handling the case, stated that Szura conspired with others to sell mollies and Xanax. The defendant used the proceeds of the Xanax sales to buy and attempt to buy approximately $74,000 in bitcoins, and then used the bitcoins to buy more drugs for distribution. Szura and co-defendant Zhe Wang were students at the University at Buffalo during a portion of the conspiracy between March 2015 and March 2016. In March 2016, law enforcement officers intercepted two packages mailed from Canada and addressed to one of Szura’s co-defendants in Amherst that each contained nearly 3,000 Xanax bars.
Zhe Wang has also been convicted and is awaiting sentencing.
The plea is the result of an investigation by Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero, and the United States Postal Inspection Service, under the direction of Inspector in Charge Shelly Binkowski.
Sentencing is scheduled for February 3, 2017, before Judge Arcara.
Seaworld Manager Sentenced to 30 Months in Prison for Stealing More Than $1 MillionRead the Press Release
Assistant U.S. Attorney Emily W. Allen (619) 546-9738
NEWS RELEASE SUMMARY – September 23, 2016
SAN DIEGO – Former SeaWorld San Diego manager Wilfred David Joseph Jobin-Reyes (known as “Sebastian Jobin”) was sentenced today to 30 months in custody for embezzling $818,000 from SeaWorld over more than eight years while he was employed there.
Jobin-Reyes created fake invoices for a sham company he secretly owned, called “SJ Merchandise.” He then used his management position to approve the payments on behalf of SeaWorld. He also created an alias along with a dummy email account he used to correspond with SeaWorld officials, pretending to be SJ Merchandise owner “John Caldwell.” In fact, Jobin-Reyes used his work computer to generate the fraudulent invoices, for disposable goods like “wildlife animal bookmarks,” “sea creature rings,” and “purple shiny ornaments” that were difficult to trace or verify in SeaWorld’s inventory. Over time, his invoices grew larger, so that by 2015 he was requesting fraudulent payments for amounts just under the $10,000 threshold that would have triggered further review by his bosses at SeaWorld. SeaWorld eventually discovered the fraud, but only after Jobin-Reyes had pocketed more than $800,000 in payments to his fake company.
Jobin-Reyes’ fraud did not stop with SeaWorld. He also used the sham merchandise company to cheat the IRS by claiming fake expenses on his tax returns. By pretending that his business was underwater with hefty losses, Jobin-Reyes reduced the amount of taxes he claimed he owed, and underpaid more than $200,000 for tax years 2010 through 2014. In fact, none of the claimed expenses were true, because SJ Merchandise didn’t conduct any real business at all.
In addition to the fabricated “John Caldwell,” Jobin-Reyes also stole the identity of a real person, his friend and former roommate who had once given Jobin-Reyes access to his personal information. Jobin-Reyes convinced his friend to open business banking and credit accounts, using the friend’s social security number and good credit, then used those accounts to receive and disburse the illegal proceeds from SeaWorld. He then went on to use the friend’s social security number to open several new credit cards, without the friend's knowledge. Jobin-Reyes admitted that he left his friend with unpaid and overdue balances of at least $177,000.
Jobin used the money he stole from SeaWorld, the taxpayers, and his friend’s credit cards to fund a lavish lifestyle he could not otherwise afford. He spent the proceeds on cruises, plane tickets, hotels, restaurants, and shopping. In the year preceding his arrest, according to court documents, he traveled around the country from New Orleans to Hawaii, spending the stolen money. He even arranged to have credit cards printed for his family members, secretly racking up more debt on his friend’s credit.
“Business insiders who abuse the trust of their employers and the community should be warned that they face serious consequences and will be brought to justice,” said U.S. Attorney Laura E. Duffy. “We are dedicated to protecting our local businesses, citizens, and taxpayers from corruption and deceit.”
U.S. Secret Service Special Agent in Charge David Murray said, “Today’s sentencing is a reminder to those who engage in financial fraud and identity theft, that the U.S. Secret Service and its law enforcement partners will actively investigate and pursue prosecution of those who violate the trust of their employers for their own personal gain.”
“As today’s sentencing of Mr. Jobin-Reyes demonstrates, defrauding your employer, your friend, and deceiving the IRS results in serious consequences, both financially and in terms of one’s freedom,” stated IRS-Criminal Investigation Acting Special Agent in Charge Anthony J. Orlando. “IRS-Criminal Investigation is committed to working with our law enforcement partners, as well as with members of the local community, to identify, investigate, and prosecute those who commit fraud for their own personal financial gain.”
Jobin-Reyes was arrested in Dallas, Texas in March 2016, and since arrest he has been detained in federal custody as a flight risk. He was sentenced by U.S. District Judge Jeffrey T. Miller. In addition to the prison sentence, Jobin-Reyes was ordered to pay $818,000 in restitution to SeaWorld and $177,000 to the victim of the identity theft. He also is obligated to pay hundreds of thousands of dollars in back taxes and penalties to the IRS.
DEFENDANT:
Wilfred David Joseph Jobin-Reyes, 16CR0811-JM Age: 48 San Diego, CA
CHARGES
Wire Fraud, in violation of 18 U.S.C. § 1343
Maximum Penalties: 20 years’ imprisonment, $250,000 fine, $100 special assessment, restitution.
Filing False a Tax Return, in violation of 26 U.S.C. § 7206(1)
Maximum Penalties: 3 years’ imprisonment, $250,000 fine, $100 special assessment, restitution.
AGENCIES
United States Secret Service
Internal Revenue Service Criminal Investigation
Sacramento Resident Indicted for Receiving Child PornographyRead the Press Release
SACRAMENTO, Calif. — Jeffrey Miles Hayes, 54, of Sacramento, was arrested today after a federal grand jury returned an indictment charging him with receipt of child pornography, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, law enforcement identified an internet connection at Hayes’s residence that was being used to upload child pornography to blog sites. A search of the residence revealed an iPad, identified as belonging to Hayes, that was receiving and distributing child pornography through chat messages.
This case is the product of an investigation by the Sacramento Internet Crimes Against Children Task Force in conjunction with the Sacramento County Sheriff’s Office and the Federal Bureau of Investigation. Assistant United States Attorney Shelley D. Weger is prosecuting the case.
If convicted, Hayes faces a sentence of 15 to 40 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
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 those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet safety education.
Postal Service Employee Convicted of Fraudulently Receiving over $50,000 in Worker’s Compensation BenefitsRead the Press Release
Baltimore, Maryland – A federal jury today convicted U.S. Postal Service employee Lori A. Parry, age 44, of Baltimore, today on charges related to her fraudulent receipt of over $50,000 in federal worker’s compensation benefits.
The conviction was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Paul L. Bowman of the U.S. Postal Service, Office of Inspector General.
According to information presented at her five-day trial, Parry was employed by the U.S. Postal Service from 1989 through July 2013, as a letter carrier and in other positions. On November 12, 1992, Parry, while employed as a letter carrier at the Dundalk Post Office, claimed that she suffered a left knee contusion while delivering mail.
Employees of the USPS who are disabled due to occupational injuries can receive compensation benefits under the Federal Employees’ Compensation Act (FECA), which is administered by the Department of Labor (DOL) Office of Worker’s Compensation Programs (OWCP). In certain cases, employees can receive up to 75% of their monthly salary.
According to the evidence, in December 2004, Parry applied for FECA benefits due to the 1992 injury. Although Parry received treatment from various physicians, including several arthroscopic surgeries and extensive physical therapy, she reported little or no improvement. Parry returned to limited duty assignments at the Post Office, and worked semi-regularly for much of 2004 through 2007.
On February 8, 2007, Parry had surgery on her knee, and did not return to work. Parry reported that she was unable to work, and requested additional FECA benefits. Witnesses testified that Parry received FECA benefits for the knee injury from February 8, 2007 through June 1, 2013, totaling over $249,000. The evidence showed that multiple times during that period, Parry claimed in documents and oral statements supporting her claim for benefits that she was unable to return to work in any capacity during that time.
According to trial evidence, from at least February 2012 through August 22, 2013, Parry’s medical condition improved so that she was capable of performing work at the USPS. Parry did not report the improvement in her medical condition to the DOL or to the USPS, as required. In addition, witnesses testified that Parry falsely represented her medical condition to her treating physician, and on February 9, 2012, at the end of an appointment with her physician, Parry gave the doctor a $100 bill as she was leaving the office.
According to trial testimony, an investigation determined that from at least September 2012 through April 2013, while receiving FECA benefits, Parry regularly engaged in strenuous yard work and other vigorous activities. Parry was observed and videotaped as she performed these tasks without limitation and not wearing a brace of any kind.
At Parry’s next visit to her physician, she was informed that she was physically able to return to her employment. The same day as that visit, April 22, 2013, Parry returned to full duty as a mail processing clerk without restrictions at the Baltimore Processing and Distribution Center (P&DC).
Witnesses testified that on April 23, 2013, Parry was interviewed by investigators and confirmed she last worked on February 7, 2007 and returned to full duty on April 22, 2013. Parry falsely told investigators that she did not and could not engage in any strenuous activity while she was off work. Parry falsely stated that she just sat on the couch all day watching television, reading, and crocheting, and denied performing any strenuous activities.
Trial evidence showed that from March 2012, through June 1, 2013, Parry fraudulently received FECA benefits totaling more than $50,000.
Parry faces a maximum sentence of five years in prison for false statement and fraud to obtain federal employees’ compensation and for making false statements; and a maximum of 10 years in prison for theft of government property. U.S. District Judge Ellen L. Hollander has scheduled sentencing for January 19, 2017, at 2:00 p.m.
United States Attorney Rod J. Rosenstein commended the USPS-OIG for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Paul E. Budlow, who is prosecuting the case.
Portola Valley and Hillsborough Residents Charged in Bank Fraud SchemeRead the Press Release
SAN FRANCISCO – Naum Morgovsky was arraigned in federal court today for his alleged role in a scheme to defraud two federally-insured banks through short sales of two rental properties in Hawaii, announced United States Attorney Brian J. Stretch and Federal Bureau of Investigation Special Agent in Charge John F. Bennett. The arraignment took place in San Francisco before the Honorable Sallie Kim, U.S. Magistrate Judge, and follows an indictment handed down by a federal grand jury on September 29, 2016, charging Morgovsky and his co-defendant, Mark Migdal, with conspiring to commit the alleged crimes.
According to the indictment, between June 2009 and July 2016, Morgovsky, 67, of Hillsborough, and Migdal, 71, of Portola Valley, conspired to defraud two federally-insured banks, now Bank of America and EverBank, by seeking the banks’ approval for short sales of two condominiums. A short sale is a sale in which a lender allows a property to be sold at a price less than the amount owed on the loan. The indictment alleges that in 2006, Migdal purchased condominiums in a development in Kihei, Maui. The defendants then sought the banks’ approval of the short sales in the same development in which Migdal owned the other properties. According to the indictment, Morgovsky and Midgal conspired to convince the banks to allow the properties to be sold to a person who was deceased, but whose identity was used to conceal the true identity of the purchaser. The conspiracy also allegedly involved submission of false statements to the bank about Midgal’s employment status and income. After the banks approved the short sales in 2009 and 2010, Migdal continued to treat the property as his own, including collecting rent and paying taxes and homeowners’ association dues. The properties were transferred to Migdal’s wife in April 2016.
On August 24, 2016, the United States Attorney’s Office for the Northern District of California filed a complaint against Morgovsky alleging he committed bank fraud. The indictment adds Migdal as a defendant and charges Morgovsky and Migdal each with two counts of bank fraud, in violation of 18 U.S.C. § 1344, and one count of conspiracy, in violation of 18 U.S.C. § 1349. The indictment also seeks forfeiture of the two Hawaii properties. Morgovsky made his initial appearance on August 26, 2016. He remains released from custody on a $1 million bond. Morgovsky’s next appearance is scheduled for October 4, 2014 before the Honorable Vince Chhabria, U.S. District Judge, for a status conference. Migdal is scheduled to make his initial appearance on October 3, 2016, in San Francisco.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendants face a maximum sentence of thirty years in prison and a fine of $1,000,000 for each count of bank fraud and conspiracy. However, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorneys John Hemann, Ila Deiss, and Colin Sampson are prosecuting the case. The prosecution is the result of an investigation by the Federal Bureau of Investigation and Internal Revenue Service, Criminal Investigation.
Mililani Businesswoman Pleads Guilty to Filing False Tax ReturnRead the Press Release
HONOLULU – Amalia Ralar, age 43, of Mililani, Hawaii, doing business as Muscle Inc., pleaded guilty in federal court on September 26 to filing a false tax return for the year 2012. At sentencing, scheduled for January 12, 2017, before Senior District Judge Helen Gillmor, Ralar faces a maximum three-year prison sentence and a fine of up to $250,000.
Florence T. Nakakuni, United States Attorney for the District of Hawaii, said that according to court documents, Ralar filed a Form 1040 tax return for 2012 that claimed tax due and owing of only $10,872 based on $50,672 in taxable income. In fact, Ralar’s actual income for 2012 was $380,364, which would have resulted in tax of $112,703. As a result, Ralar under-reported her tax for 2012 by $101,831.
Moreover, according to information produced to the court, Ralar agreed that the tax returns she filed for the years 2007, 2008, 2009, 2010, 2011, 2013, and 2014 were also not true and accurate returns. Ralar excluded income from her business operations, resulting in total unpaid tax from 2007 to 2014 of $354,511. Ralar stipulated that she owes that amount in restitution to the IRS. While Ralar’s guilty plea is specifically for the 2012 tax year, her sentencing will be based on the aggregate amount of the loss from all of the years she filed false returns.
The Internal Revenue Service Criminal Investigation Division (IRS CI) led the investigation. The prosecution was handled by Assistant U.S. Attorneys Ken Sorenson and Larry Tong.
Michigan man sentenced for oxycodone distributionRead the Press Release
WHEELING, WEST VIRGINIA – Jeremy Colby Vickerson, 28, of Canton, Michigan, was sentenced to 30 months in prison for distribution of oxycodone, United States Attorney William J. Ihlenfeld, II, announced.
Vickerson was arrested near Bridgeport, West Virginia after being found in possession oxycodone pills. He previously pled guilty in April 2016 to one count of “Distribution of Oxycodone Within 100 Feet of a Video Arcade Facility.”
Assistant U.S. Attorney Shawn M. Adkins prosecuted the case on behalf of the government. The Harrison County Street Crimes and Drug Unit investigated.
U.S. District Judge Irene M. Keeley presided.
McAllen Man Convicted of Attempted Enticement of an Individual he Believed was a MinorRead the Press Release
McALLEN, Texas – Timinson Erin Jackson, 25, of McAllen, has entered a guilty plea to an indictment charging him with attempted enticement of a minor, announced U.S. Attorney Kenneth Magidson.
From May 25, 2016, to June 3, 2016, Jackson engaged in online communications with a person he thought was a 12-year-old minor female. That individual was actually an undercover agent with Immigration and Customs Enforcement’s Homeland Security Investigations (HSI). During these conversations, which were mostly carried out via text messaging, Jackson attempted to persuade, induce and entice this “minor” into having sex with him.
On June 3, 2016, Jackson arranged to meet the individual at a park in McAllen. He was arrested upon his arrival. At that time, Jackson admitted he intended to have sex with an individual whom he believed was a 12-year old minor female.
U.S. District Judge Randy Crane, who accepted the guilty plea today, has set sentencing for Dec. 13, 2016. At that time, Jackson faces a minimum of 10 years and up to life in federal prison and a possible $250,000 fine. He will remain in custody pending that hearing.
HSI conducted the investigation.
This case, prosecuted by Assistant U.S. Attorney Alex Benavides, 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."
Lincoln Man Sentenced for Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney, Deborah R. Gilg, announced that on September 30, 2016, Zachary A. Olson, 27, of Lincoln, was sentenced to nine years and two months (110 months) in prison for his involvement in a conspiracy to distribute and possess with intent to distribute 500 grams or more of a substance containing methamphetamine between October of 2014 and October of 2015. Following the prison term, Olson will serve five years on supervised release.
Information obtained by law enforcement indicated that Olson was responsible for the distribution of at least 1.5 kilograms (three pounds) of methamphetamine in the Lincoln area. On October 27, 2015, Lincoln Police contacted Olson and other persons at a Lincoln hotel where at least 35 grams of pure methamphetamine were found. Olson admitted to officers that he had been using and selling methamphetamine for two months.
Olson is currently serving a state sentence of three to five years from Lancaster County District Court for possession with intent to distribute hydrocodone pills. That sentence resulted from a related incident in January of 2015 in which Olson and other persons were contacted at a Lincoln motel and found to be distributing drugs. One of Olson’s associates was found in possession of 49 grams of methamphetamine at that time. Olson’s federal sentence will run concurrent with (at the same time as) the remainder of his state sentence.
This case was investigated by the Lincoln/Lancaster County Drug Task Force.
Justice Department Files Housing Discrimination Lawsuit Against Owner and Managers of Florida Mobile Home ParkRead the Press Release
This Case is the Third Mobile Home Park Race Discrimination Case the Justice Department Has Filed in the Middle District of Florida in the Last Year
The Justice Department announced today that it has filed a lawsuit against James C. Goss, the owner, and Cathy Plante and Joey Gwozdz, the managers, of May Grove Village Mobile Home Park, an 81-lot property in Lakeland, Florida. The lawsuit alleges that the defendants discriminated against African Americans in violation of the Fair Housing Act.
The lawsuit, filed in the U.S. District Court for the Middle District of Florida, alleges that the managers falsely told African Americans that no mobile homes, or fewer mobile homes, were immediately available for sale, but told similarly situated white persons that more mobile homes were available. According to the complaint, the managers also quoted prospective African-American purchasers higher prices and worse financial terms than similarly situated white purchasers. The lawsuit is based on the results of testing conducted by the department’s Fair Housing Testing Program, in which individuals pose as buyers to gather information about possible discriminatory practices.
“Housing providers cannot pick and choose homebuyers based on race,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “We will continue to vigorously enforce the Fair Housing Act to ensure that all people in this country are able to secure housing without facing unlawful barriers.”
The suit seeks monetary damages to compensate victims, civil penalties against the defendants to vindicate the public interest and a court order barring future discrimination.
Individuals who have information about, or who believe they may have been discriminated against at May Grove Village, located at 1725 Gibsonia Galloway Road, in Lakeland, should contact the Justice Department toll-free at 1-800-896-7743, option 94, or by email at [email protected]. The Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability. More information about the Civil Rights Division and the laws it enforces is available at www.usdoj.gov/crt.
Goss ComplaintJustice Department Announces Nine Studies Focused on Approaches to Life-Saving Work Authorized by the Violence Against Women ActRead the Press Release
Today the Justice Department’s Office on Violence Against Women (OVW) announced nine new research projects—the first in its Research and Evaluation Initiative launched earlier this year. All nine awards focus on learning more about effective approaches for doing the life-saving work authorized through the Violence Against Women Act (VAWA) and examine specific issues related to victims from underserved and marginalized populations.
The Research and Evaluation Initiative emphasizes researcher-practitioner partnerships that can identify effective strategies and lead to sustainable ways of responding to sexual assault, domestic and dating violence and stalking, and reducing the harmful impact of these crimes on victims and communities.
“These new research and evaluation studies are critical because they focus on issues that are extremely understudied – such as culturally-specific programs for Latina victims, the effects of victimization on incarcerated women, restorative justice and gender bias,” said OVW Principal Deputy Director Bea Hanson, Ph.D. “The more we identify approaches and models that effectively work with specific populations, the more effective we can be in helping victims find the justice they need and deserve.”
OVW’s Research and Evaluation Initiative is developing a comprehensive understanding of what we know about the effectiveness of approaches funded by the VAWA and determine which practices require a closer look and further study.
The nine studies are:
1. University of California, Los Angeles, $399,998: A study of the effects of violence and victimization on incarcerated women and an evaluation of a program designed to reduce the recurrence of violence and victimization in their lives.2. Washington University, $379,980: An evaluation of an approach to using cognitive processing therapy in rape crisis centers.
3. Community Health and Social Services Center, $348,339: A study of how a culturally-specific program for Latina victims of domestic and sexual violence meets victims’ self-defined needs.
4. University of New Hampshire, $398,857: A study of a trauma-informed residential program for victims of domestic violence who struggle with substance use disorders.
5. International Rescue Committee Inc., $314,666: A study of the experiences, service needs and help-seeking strategies of refugees, asylum-seekers and other newly-arrived immigrants who are victims of domestic violence and sexual assault.
6. University of Kentucky Research Foundation, $499,999: An examination of the healing and self-sufficiency benefits of an agriculture-based program for residents of a domestic violence shelter.
7. Portland State University, $400,000: A study of patterns and disparities in the family court experiences of litigants from cultural and linguistic minority groups.
8. Sam Houston State University, $393,049: An evaluation of a training program for all sworn law enforcement personnel in an urban police department on the Justice Department’s guidance on gender-bias policing.
9. Fund for the City of New York, $271,720: A survey of programs that use restorative justice to address domestic violence and the development of guidelines for these programs. Restorative justice seeks to rehabilitate offenders through reconciliation with the people and communities they have victimized.* * *
OVW provides leadership in developing the nation’s capacity to reduce violence against women through the implementation of VAWA and subsequent legislation. Created in 1995, OVW administers financial and technical assistance to communities across the country that are developing programs, policies and practices aimed at ending domestic violence, dating violence, sexual assault and stalking. In addition to overseeing 21 federal grant programs, OVW often undertakes initiatives in response to special needs identified by communities facing acute challenges.
Justice Department Announces Fair Housing Settlement with Montana DevelopersRead the Press Release
The Justice Department announced today that the developers and designers of 31 apartment buildings in or near Helena, Montana, have agreed to settle a lawsuit alleging that the buildings were not built to be accessible to people with disabilities, as required by the Fair Housing Act.
The department’s lawsuit, which was also filed today, alleges that the developers and designers of the properties designed and built the 64 ground floor apartments at these buildings with steps to unit entrances, inaccessible bathrooms and kitchens or other features that make them inaccessible to people with disabilities. The defendants named in the suit include the developers and their affiliated companies – Gabriel Nistler, Sommer Nistler, Ross Royland, Patrick Royland, Royland & Nistler Properties LLC and Werner-Nistler Properties LLC – and the designers of the properties, Derek Brown and Derek Brown Consulting Inc.
Under the settlement, which still must be approved by the U.S. District Court for the District of Montana, the defendants must undertake extensive corrective actions to make the apartment buildings accessible to persons with disabilities, including wheelchair users. These corrective actions include:
- creating accessible routes to ground floor apartment entrances, accessible routes to parking, mailboxes and other common areas;
- making interior modifications such as moving the locations of fixtures or moving the location of electrical outlets and thermostat controls that make the apartments more accessible to people with disabilities;
- constructing new multifamily housing with enhanced accessibility features; and
- paying $20,000 to establish a settlement fund for the purpose of compensating individuals with disabilities who have been harmed by the accessibility violations.
“All people with disabilities deserve an equal opportunity to live in the housing of their choice,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “By removing accessibility barriers in existing buildings and creating new accessible units, this settlement will help ensure that individuals with disabilities in Helena, Montana, enjoy the rights guaranteed by the Fair Housing Act.”
“This settlement is emblematic of the Justice Department’s commitment to fair housing standards for all,” said U.S. Attorney Michael Cotter of the District of Montana. “It sends a message that failing to consider the needs of individuals with disabilities in the construction of new housing is simply not acceptable in Montana communities, and helps ensure that the needs of those individuals will be considered from the earliest stages of the design and permitting processes.”
Individuals who may be entitled to share in the settlement fund will be identified through a process established in the settlement. Persons who believe they were subjected to unlawful discrimination at one of the properties either when they lived there or considered living there should contact the Justice Department toll-free at 1-800-896-7743, Mailbox 9995, or email the department at [email protected].
The Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. Among other things, the Fair Housing Act requires that new multifamily housing be designed and constructed with features that make it accessible to people with disabilities. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Individuals who believe that they may have been victims of housing discrimination can call the Housing and Civil Enforcement Section at 1-800-896-7743, email the Justice Department at [email protected] or contact the U.S. Department of Housing and Urban Development at 1-800-669-9777 or through www.hud.gov/fairhousing.
Nistler II Complaint Nistler II Consent DecreeJob Fair Held for Returning Citizens as Part of the Deparment of Justice's Smart on Crime InitiativeRead the Press Release
GRAND RAPIDS, MICHIGAN —U.S. Attorney Patrick Miles announced the holding of a job fair today in West Michigan for individuals who have recently returned to our communities after serving their terms in the custody of either the Michigan Department of Corrections or the Federal Bureau of Prisons. The event is part of the Department of Justice’s Smart on Crime initiative. Approximately 250 returning citizens connected with 18 local employers about job opportunities at the Job Fair, which took place at LINC UP, 1167 Madison SE, in Grand Rapids. This is the first job fair in West Michigan targeting returning citizens.
"Employment is crime prevention," U.S. Attorney Miles explained. "We are working on not only prosecuting crimes, but also preventing them. A lack of job opportunity for those who have paid their debt to society and served their time is a primary reason they return to a life of crime. A felony record should not be an automatic life-time ban on any employment. We need those with a felony record in their past to be productive citizens contributing to society and taking care of their loved ones."
The Job Fair follows the Employer Summit U.S. Attorney Miles held with area employers in May to encourage them to consider increasing their talent pool through the hiring of formerly incarcerated individuals. Given the turn-out of employers today, the Summit succeeded. Eighteen companies were represented at the Fair, including Cascade Engineering and Butterball Farms Inc. Cascade Engineering and Butterball Farms, Inc., have experienced great success hiring returning citizens. U.S. Attorney Miles expects the many additional employers in attendance today will soon have the same experience. Approximately 250 candidates for employment attended to help prove him right.
U.S. Attorney Miles noted that "about one in three Americans has a criminal record. I appreciate those employers who recognize the importance of not excluding a large segment of our society from being productive."
The Employer Summit and Job Fair are part of U.S. Attorney Miles’s on-going efforts to address the problem of recidivism beyond simply re-prosecuting. In 2015, he introduced "Facing Choices" forums in partnership with the Michigan Department of Corrections, for state parolees. Parolees are not only reminded that they will be held accountable if they re-offend, they also hear from formerly incarcerated individuals who share strategies for success while on parole. U.S. Attorney Miles will host a Facing Choices forum next week in Benton Harbor. U.S. Attorney Miles’s office also supports the U.S. District Court’s Accelerated Community Entry program of intensive supervision for individuals on federal supervised release who present a high risk of recidivism.
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Illinois Furniture Importer and Manager Agree to Pay $1,525,000 to Resolve False Claims Act Allegations Under Civil Settlement with United StatesRead the Press Release
Daniel Scott Goldman and his companies, Ecologic Industries LLC and OMNI SCM LLC will collectively pay $1,525,000 under a civil settlement with the United States Department of Justice, announced United States Attorney Richard L. Durbin, Jr. The settlement resolves a lawsuit brought under the False Claims Act alleging that the companies made or conspired with others to make false statements to avoid paying duties on wooden bedroom furniture imported from the People’s Republic of China.
Ecologic Industries sells furniture for student housing, while OMNI SCM provided procurement and supply chain services and served as importer of record for Ecologic. Goldman controlled both entities through a number of LLCs and trusts. Under the agreement, Goldman will pay a total of $850,000.00, while OMNI and Ecologic together will pay $675,000.00.
“Customs duties are meant to protect domestic companies and American workers from unfair competition from abroad. Those who import goods into the United States must comply with the law,” said U.S. Attorney Richard L. Durbin, Jr.
The government alleged that between February 2012 and December 2014, Ecologic, OMNI and Goldman knowingly misclassified or conspired with others to misclassify wooden bedroom furniture on documents presented to U.S. Customs and Border Protection (CBP) to avoid paying antidumping duties on imports of wooden bedroom furniture manufactured in the People’s Republic of China. Specifically, Goldman and his companies allegedly classified the furniture as office and other types of furniture not subject to duties while selling the furniture in the student housing market for use in dormitory bedrooms. The Department of Commerce assesses, and CBP collects, antidumping duties to protect U.S. businesses by offsetting unfair foreign pricing and foreign government subsidies.
The allegations resolved by the settlement were originally brought by Matthew L. Bissanti, Jr. under the qui tam or whistleblower provisions of the False Claims Act. The act permits private parties to sue on behalf of the United States those who falsely claim federal funds or, as in this case, those who avoid paying funds owed to the government or cause or conspire in such conduct. The act also allows the whistleblower to receive a share of any funds recovered through the lawsuit. Bissanti will receive $228,750.00 as his share of the settlement.
The lawsuit is captioned United States ex rel. Bissanti v. Daniel Scott Goldman, et al., No. A14-CV-00497 (W.D. Tex.). The case was handled by the U.S. Attorney’s Office for the Western District of Texas; Civil Division’s Commercial Litigation Branch; CBP’s Office of Field Operations, Office of Regulatory Audit and Office of Chief Counsel; and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Assistant United States Attorney Susan Strawn handled the case for the government.
Hyde Street Shooting Investigation Leads to Arrest of New York Man on Gun and Drug CrimesRead the Press Release
The Office of the United States Attorney for the District of Vermont stated Quincy Alexander, 28, of Brooklyn, New York, was charged today in a two-count complaint filed in federal court with being a felon in possession of a firearm and with possession with intent to distribute cocaine base. Alexander is scheduled to appeared before U.S. Magistrate Judge John M. Conroy at 4:00 p.m. today.
According to the affidavit in support of the criminal complaint, Burlington Police came into contact with Alexander during their investigation of the September 28, 2016, shooting at 31 Hyde Street in Burlington, Vermont. Officers approached Alexander on September 29, 2016, as he was sitting in a vehicle matching the description of the vehicle involved in the shooting. After a trained narcotics dog alerted to the presence of narcotics, law enforcement, working with the Office of the Chittenden County State’s Attorney, obtained a search warrant for the vehicle from the Chittenden County Superior Court. The resulting search located two firearms, a 9 mm pistol and a .38 caliber revolver, and approximately 80 grams of crack cocaine packed for further distribution. During the investigation of the 31 Hyde Street shooting, police recovered 9 mm bullets within residences that had entered the premises through the exterior of the building.
Records checks indicated Alexander had two prior felony convictions for Grand Larceny from New York, prohibiting him from possessing a firearm.
Shortly after his arrest, Alexander complained of chest pains and was taken by Burlington Police to the Emergency Department at UVM Medical Center for treatment. Although he remained handcuffed while in the Emergency Department, Alexander attempted to escape, fleeing his examination room. He was re-apprehended by Burlington Police officers before he could leave the facility.
The complaint filed today is an accusation only and the defendant is presumed innocent until and unless proven guilty. If convicted, Alexander could face up to ten years in prison for his possession of a firearm as a felon, and up to twenty years for his possession with intent to distribute crack cocaine.
“The combination of drugs and guns is a lethal one that has no place in the Burlington community,” United States Attorney Eric Miller said. He commended the Burlington Police Department and the Chittenden County State’s Attorney’s Office for their quick work in apprehending Alexander, and thanked the U.S. Drug Enforcement Administration and the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives for their support of the investigation.
"We will not tolerate gun violence in Burlington and our response to it will always be relentless," said Brandon del Pozo, the Burlington Chief of Police. "I'd like to thank our officers for their fast and thorough search for the suspect's vehicle and the safe and careful work they did once it was located. We're grateful to the US Attorney's office and the Federal Bureau of Alcohol, Tobacco, Firearms and Explosives for their assistance. We're fortunate to have this team protecting our city."
Mickey D. Leadingham, Special Agent in Charge, ATF Boston Field Division, stated,
"ATF has a strong presence in Burlington, Vermont, and works closely on combatting gun violence with the Burlington Police Department and the U.S. Attorney’s Office. ATF will continue to build on these relationships in its efforts to curb gun violence, along with the illegal possession of firearms."AUSA Michael P. Drescher represents the United States. The Office of the Federal Public Defender represents Alexander.
Home Health Care Agency Ordered to Pay over $6 Million for False Claims Made to D.C. MedicaidRead the Press Release
WASHINGTON – A federal judge has ordered Speqtrum Inc., a home health care agency, to pay the United States $6.15 million in civil damages after ruling in the government’s favor in a lawsuit alleging that the company violated the False Claims Act by repeatedly and routinely falsifying records to obtain funds from Medicaid.
The judgment was announced today by U.S. Attorney Channing D. Phillips, Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, and Nicholas DiGiulio, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), for the region that includes Washington, D.C.
The United States filed suit against the company in 2010 and the case went to trial earlier this year in the U.S. District Court for the District of Columbia. In February 2016, the Honorable James E. Boasberg ruled in favor of the government, and on September 23, 2016, he issued the order setting damages.
According to the government’s evidence, Speqtrum, Inc. is based in Upper Marlboro, Md., and operated in the District of Columbia. The company was a participating provider and received reimbursement from the District of Columbia’s Medicaid program.
Under the Medicaid program, Speqtrum, Inc. was initially approved to furnish elderly and disabled patients with assistance in the day-to-day activities of living, such as bathing, dressing, and taking needed medications. D.C. Medicaid, which is subsidized by the federal Medicaid program, paid for many of Speqtrum’s services for low-income patients.
The District of Columbia’s Department of Health Care Finance discovered irregularities in Speqtrum’s records during a routine audit in May 2009. A team consisting of Special Agents from the FBI’s Washington Field Office and the U.S. Department of Health and Human Services Office of the Inspector General then began an investigation, which included the execution of search warrants on Speqtrum’s offices in Washington, D.C. The documents collected confirmed that patient files contained forged signatures or falsified timesheets. One document contained various practice runs at forging a doctor’s signature – which later appeared in a patient file. Still other documents demonstrated that employees alerted Speqtrum’s President and Founder, Pauline Nnawuba, to the fact that high-level employees had been defrauding Medicaid on the company’s behalf, but Speqtrum failed to report the conduct to Medicaid. At the conclusion of the investigation, the United States filed the False Claims Act action, alleging a massive and routine pattern of fraud by high-level employees of Speqtrum.
In his decision to treble the initial $1.3 million damages awarded to the United States under the False Claims Act, and to further impose an additional $10,000 civil penalty for each of the 216 D.C. Medicaid invoices submitted by Speqtrum, Judge Boasberg found the loss to Medicaid to be “substantial,” and further found that Speqtrum’s conduct was “egregious and willful in its cooking of the books, overbilling for hours not worked, charging … for clients it did not service, and forging physician signatures on its paperwork.” Accordingly, Judge Boasberg awarded the United States a total of $6.15 million. The amount will be shared with the District of Columbia’s Medicaid program.
In announcing the judgment, U.S. Attorney Phillips, Assistant Director in Charge Abbate, and Special Agent in Charge DiGiulio commended the work of those who investigated the case from the FBI and HHS-OIG. They also expressed appreciation for the assistance provided by the District of Columbia Office of the Attorney General and the Medicaid Fraud Control Unit of the District of Columbia Office of the Inspector General. Finally, they acknowledged the efforts of those who worked on the case and brought it to trial from the U.S. Attorney’s Office, including Assistant U.S. Attorney Darrell C. Valdez and Paralegal Specialist Idongesit “Benji” Umo.
The lawsuit is captioned United States v. Speqtrum, Inc., Civil Action 10-cv-2111 (D.D.C.).
Harrison County man sentenced for unlawful possession of firearmRead the Press Release
CLARKSBURG, WEST VIRGINIA – Aric J. Stutler, 38, of Mount Clare, West Virginia, was sentenced today to 84 months in prison for illegally possessing a firearm, United States Attorney William J. Ihlenfeld, II, announced.
Stutler, who was previously convicted of “Armed Bank Robbery” in Ohio, was discovered to be in possession of a .22 caliber pistol last year in Harrison County, West Virginia. Stutler pled guilty in May 2016 to one count of “Felon in Possession of a Firearm.”
Assistant U.S. Attorney David J. Perri prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the West Virginia State Police investigated.
U.S. District Irene M. Keeley presided.
Gorham Man Sentenced to 10 Years for Fentanyl and Heroin TraffickingRead the Press Release
Contact: Daniel J. Perry
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that David Thurlow, 28, of Gorham, Maine, was sentenced yesterday in U.S. District Court by Judge D. Brock Hornby to 10 years in prison to be followed by three years of supervised release for distributing fentanyl and heroin.
According to Court records, from at least December 2015 until February 2016, Thurlow distributed heroin and fentanyl in the greater Portland area.
This case was investigated by the U.S. Drug Enforcement Administration, the Maine Drug Enforcement Agency, and the Gorham Police Department.
Georgia Couple Charged with Scheme to Defraud StaplesRead the Press Release
BOSTON – A husband and wife from Alpharetta, GA were charged today in U.S. District Court in Boston in connection with a scheme to defraud Framingham-based Staples, Inc. of more than $1.4 million.
John Douglas, 46, was charged in an Information with conspiracy to commit wire fraud and mail fraud. His wife, Analyn Douglass [sic], 41, was separately charged in an Information with conspiracy to ship stolen goods in interstate commerce.
According to the Information, the Douglases and others engaged in a complex scheme to defraud Staples of more than $1.4 million worth of customer loyalty rewards and product rebates. John Douglas and one of his associates created more than 1,100 Staples rewards accounts, often using fictitious names, addresses, and contact information. He then created a computer script to query a Staples web site and seek unclaimed customer loyalty rewards for purchases that he did not make. The computer script made thousands of queries a day, amassing more than $889,000 worth of rewards in small increments, often less than a dollar at a time. The Douglases and others then used the rewards like cash to buy merchandise at Staples retail locations throughout the southern United States and along the eastern seaboard, as far north as Massachusetts. Analyn Douglass sold much of the fraudulently obtained Staples merchandise on eBay.
In addition, the Douglases and the associate allegedly used a similar method to claim more than $527,000 in cash rebates from Staples for products that they did not purchase.
Staples discovered the fraud and referred the matter to the Federal Bureau of Investigation and the United States Attorney’s Office for investigation. Staples has cooperated with the government’s investigation.
The charges of conspiracy to commit wire fraud and mail fraud provide for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000 or twice the gross gain/loss from the offense, whichever is greater. The charge of conspiracy to ship stolen goods provides a sentence of no greater than five years in prison, three years of supervised release and a fine of $250,000, or twice the gross gain/loss, whichever is greater. 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; and Shelly Binkowski, Inspector in Charge of the U.S. Postal Inspection Service, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney David J. D'Addio of Ortiz’s Cybercrime Unit.
The details contained in the Informations are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Georgetown Woman Charged with Embezzling over $60,000 Dollars from EmployerRead the Press Release
BOSTON – A Georgetown woman was charged in U.S. District Court in Boston with embezzling over $60,000 from her former employer.
Michelle Higson, 41, was indicted on one count of bank fraud and two counts of uttering a forged security. Higson was arrested this morning and is scheduled to appear before U.S. District Court Magistrate Judge Judith Dein this afternoon.
According to the indictment, Higson worked as a part-time bookkeeper at a Rowley-based company. In her position as bookkeeper, Higson was responsible for handling the company’s accounts payable, and used the company’s accounting software program to do so. From December 2013 through January 2015, Higson stole a series of the company’s checks and made them payable to cash. Higson then forged her employer’s signatures on the stolen checks, endorsed them herself, and deposited them for cash, which she used for personal expenses.
To conceal her criminal conduct and avoid detection by company officials, Higson allegedly falsified entries in the company’s general ledger to make it appear as if the stolen checks had been issued to satisfy payment to bona fide vendors. In total, Higson embezzled over $60,000.
The charge of bank fraud provides for a sentence of no greater than 30 years in prison, five years of supervised release, and a fine of $1 million. The charge of uttering a forged security provides for sentence of no greater than 10 years in prison, three years of supervised release and a fine of $250,000. 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 and Shelly Binkowski, Inspector in Charge of the U.S. Postal Inspection Service made the announcement today. The case is being prosecuted by Assistant United States Attorney Anne Paruti of Ortiz’s Major Crimes Unit.
Four Sentenced in Lansing Credit Union RobberiesRead the Press Release
GRAND RAPIDS, MICHIGAN – U.S. Attorney Patrick Miles announced the sentence today for the last of four co-defendants, all from Detroit, in a pair of Lansing credit union robberies. U.S. Chief District Judge Robert J. Jonker sentenced Brennen Jackson, age 25, to 92 months in federal prison; Kiarra Pennymon, age 27, to 33 months; and Maurice Clark II, age 25, and Darnell Rowell, age 21, each to 37 months.
On September 3, 2015, Jackson, Pennymon and Clark robbed the DFCU Financial on S. Pennsylvania Avenue in Lansing. Jackson recruited Clark to commit the robbery, and Jackson and Pennymon drove Clark from Detroit to Lansing, stopping at a store along the way to buy makeup to cover Clark’s tattoos and colored contacts to disguise him. Pennymon admitted to assisting by casing the credit union, and she and Jackson waited in the getaway vehicle while Clark went in with a demand note and stole $40,000. Less than a week later, on September 8, 2015, Jackson and Pennymon recruited Darnell Rowell and returned to the same credit union. Jackson and Pennymon waited in the getaway van while Rowell entered the credit union with a demand note and stole $35,000. The three were apprehended by police on the highway fleeing the scene. All but $200 that was stolen in the second robbery was recovered upon their arrest.
Pennymon and Clark pled guilty to the September 3, 2015, robbery, and Jackson and Rowell pled to the September 8th robbery. All four defendants will serve three years of court supervision after they are released from prison and were each ordered to repay the credit union through restitution. The Lansing Police Department, Ingham County Sheriff’s Office, and the FBI investigated the case, which was prosecuted by Assistant U.S. Attorney Tessa K. Hessmiller.
In announcing the sentence, U.S. Attorney Patrick Miles stated, "This case represents another example of local and federal investigators working together to protect our community. The quick work of the Ingham County Sheriff’s Office and Lansing Police Department in apprehending the robbers undoubtedly protected the community from future robberies by this group."
"The sentencing of Brennen Jackson demonstrates the resolve of the FBI and our local law enforcement partners to identify those responsible for robberies of Michigan financial institutions," said David P. Gelios, Special Agent in Charge, Detroit Division of the FBI. "As part of that effort, the FBI encourages the public to use a free FBI mobile application called BANK ROBBERS, which allows members of communities to review information about unsolved bank robberies. With the public’s help, we can become even more successful in identifying, arresting, and prosecuting subjects who pose a significant threat to the public."
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Four Men Sentenced for Drug ConspiracyRead the Press Release
HARRISBURG – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that United States District Court Chief Judge Christopher C. Conner in Harrisburg sentenced Felix Rodriguez-Pabon, age 25, Berks County, PA, to 87 months and Yefries Guillan-Herrera, age 24, Berks County, to 57 months in federal prison for conspiracy to possess with intent to distribute heroin and cocaine hydrochloride.
According to United States Attorney Peter Smith, eleven defendants were originally indicted by a federal grand jury in Harrisburg in July 2015 and a Superseding Information was filed in June 2016.
The charges stem from an investigation in which the Department of Homeland Security Investigations (HSI) agents in Lebanon County intercepted packages sent from Santo Domingo, Dominican Republic to the United States between June and October 2014. The packages contained kilogram quantities of heroin and cocaine hydrochloride concealed inside xbox consoles and projectors.
On September 28, 2016, Chief Judge Conner also sentenced Wilson Herrera, age 22, Berks County, to 10 years in federal prison and Wilfreddy Perez, age 24, Lebanon, to 35 months in federal prison and on August 24, 2016, Glauco Kelvin Celedonio-Smith, age 20, of Lebanon, was sentenced to 15 years in prison. The remaining co-defendants are awaiting sentencing.
"This investigation is an excellent example of how federal, state and local law enforcement were able to successfully dismantle a major narcotics smuggling organization," said Brian Michael, acting special agent in charge of HSI Philadelphia. "HSI will continue to utilize its broad authorities to aggressively target and dismantle groups that are dispensing poison within our communities."
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the heroin initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies.
The investigation was conducted by HSI, the Pennsylvania State Police, the Berks County District Attorney’s Office Detective Unit and the U.S. Customs & Border Protection. The case was prosecuted by Assistant United States Attorney Daryl F. Bloom.
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Former Wireless Phone Company Employees Charged with Selling Customer InformationRead the Press Release
BIRMINGHAM – Federal prosecutors today charged a Birmingham man with selling private customer information, including customer cell phone records, that he obtained from his work computer at AT&T. Prosecutors last week charged a former Verizon employee in a related case, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Roger C. Stanton.
“We cannot allow people with access to sensitive personal information abuse that access for personal financial gain,” Vance said. “Anyone with a cell phone could be put at risk of harm if their private call information or tracking data is illegally accessed and used.”
“Computer crimes continue to be a high priority for the FBI,” Stanton said. “Those who engage in the kind of illegal activity Conley and Traeger participated in can expect to be prosecuted.”
In a one-count information filed today in U.S. District Court, the U.S. Attorney’s Office charged ERIC CONLEY, 33, with computer intrusion. The U.S. Attorney’s Office also filed a plea agreement with Conley. According to the agreement, Conley will plead guilty to the charge.
Conley was employed as a retail sales consultant at AT&T in Gardendale in 2011 when a private investigator offered to pay Conley for particular AT&T customer records, according to the plea agreement. Conley accepted the offer and, between 2011 and 2013, sold hundreds of customer records to the private investigator, all of which Conley had obtained from AT&T computer systems without the customers’ permission. In exchange, Conley received thousands of dollars in cash and check payments.
Last week the U.S. Attorney’s Office charged a former Verizon Wireless employee, DANIEL EUGENE TRAEGER, 51, of Bessemer, with computer intrusion for gathering customer records to sell to the same private investigator. Traeger worked for Verizon in Birmingham as a network technician. Traeger is charged in a one-count information and, like Conley, has agreed to plead guilty. Traeger has admitted that he sold the private investigator hundreds of Verizon customer call records and location data records between 2009 and 2014.
The maximum punishment for the computer intrusion offense is five years in prison and a $250,000 fine.
The FBI investigated the case, which Assistant U.S. Attorneys Erica W. Barnes and John B. Ward are prosecuting.
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Former Office Manager Sentenced for Wire FraudRead the Press Release
United States Attorney G.F. Peterman, III announces that Maria E. Trenam, age 52, of Cumming, Georgia, previously of Warner Robins, Georgia, was sentenced to serve sixty (60) months imprisonment for one count of wire fraud on September 30, 2016. The sentence was handed down by the Honorable Marc T. Treadwell, U. S. District Court Judge, in Macon, Georgia. As part of the sentence, Ms. Trenam was also ordered to pay restitution in the amount of $1,178,736.90 and was ordered to forfeit certain property obtained through the fraud, including a bank account, a house, an automobile, and a diamond ring. Following imprisonment, she will be required to serve a term of supervised release for three (3) years.
Ms. Trenam was the office manager of Surgical Associates of Warner Robins, P.C., in Warner Robins, Georgia. Surgical Associates is a health care benefit program providing surgical and other medical services to individuals under public and private plans. As office manager of Surgical Associates, Ms. Trenam had access to the banking and financial records of the business.
Beginning about March 31, 2011, through about August 11, 2015, Ms. Trenam used her position to embezzle money from Surgical Associates totaling $1,178,736.90. She embezzled money in several ways, including making unauthorized cash withdrawals at automated teller machines of financial institutions utilizing her business credit card, writing unauthorized checks to herself on business accounts and concealing the unauthorized checks by falsifying bookkeeping ledger entries, increasing her salary without authorization, using her business credit card to make unauthorized purchases of goods and services, using her business credit card for unauthorized travel and entertainment, and using her business credit card to make unauthorized purchases of goods and services on the internet.
Concerning Count One of the indictment, Ms. Trenam used her Surgical Associates business credit card to make a personal and unauthorized purchase of goods in the amount of $2,289.79 by computer on the internet from the Jo-Ann Fabric and Crafts Store in Ohio.
U.S. Attorney Peterman stated, “Ms. Trenam stole a huge sum of money, more than many people would make in their lifetime. Making it even worse, she stole from her employer, who had trusted her with access to and control over its financial assets. The greed and abuse of trust this theft demonstrates certainly called for the sentence imposed on Ms. Trenam today.”
The case was investigated by the Macon Resident Agency of the Federal Bureau of Investigation, and by the Houston County Sheriff’s Office. Assistant United States Attorney Paul C. McCommon III prosecuted the case on behalf of the Government.
Inquiries regarding the case should be directed to Pamela Lightsey at the United States Attorney’s Office at 478-621-2603.
Former NFL Player Sentenced to 15 Years in Federal PrisonRead the Press Release
Jacksonville, Florida – U.S. District Judge Timothy J. Corrigan has sentenced Donald Broomfield (40, Jacksonville) to 15 years in federal prison for his involvement in a conspiracy to distribute 5 kilograms or more of cocaine that spanned 4 years. A federal jury found him guilty on October 6, 2015.
According to court documents, Broomfield began obtaining kilograms of cocaine from a source of supply in Texas in 2010. He then distributed the drugs to individuals in Jacksonville and Orlando. Broomfield, and others at his direction, used various vehicles equipped with hidden compartments to transport the cocaine. As part of an on-going investigation, on August 8, 2014, Broomfield was stopped by the Jacksonville Sheriff’s Office (JSO) while driving his Chrysler 300. A drug detecting canine alerted on the vehicle and a subsequent search revealed 1.6 kilograms of cocaine in a hidden compartment. The same day, JSO officers searched a residence in Jacksonville where Broomfield had been storing cocaine for several years. They seized empty kilogram wrappers, a cocaine press, digital scales, and drug packaging materials. Testimony at trial established that Broomfield was a leader of the conspiracy and was responsible for the distribution of 50 – 150 kilograms of cocaine. This was his first felony conviction.
Broomfield was drafted in 1999 by the Cincinnati Bengals and, in 2000, he signed with the Arizona Cardinals. During the summer of 2001, he participated in the Jacksonville Jaguars training camp.
This case was investigated by the Jacksonville Sheriff’s Office. It was prosecuted by Assistant United States Attorney Julie Hackenberry Duva.
Florida Business Owner Charged in Telemarketing-Related Fraud SchemeRead the Press Release
A Florida business owner was charged in an indictment unsealed today with participating in a scheme that sold the personal information of tens of thousands of individuals to fraudulent telemarketers, who in turn used the information to target potential victims for various fraudulent telemarketing schemes.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney A. Lee Bentley III of the Middle District of Florida, Special Agent in Charge Richard T. Thornton of the FBI’s Minneapolis Field Office, Special Agent in Charge Christopher Combs of the FBI’s San Antonio Field Office and Special Agent in Charge Paul Wysopal of the FBI’s Tampa, Florida, Field Office made the announcement.
Ronald John Mendleski, 72, of Bokeelia, Florida, was charged with one count of conspiring to commit wire fraud and three counts of wire fraud. He self-surrendered to the U.S. Marshals and will make his initial appearance later today before U.S. Magistrate Judge Carol Mirando of the Middle District of Florida. A trial date has not yet been set.
According to the indictment, beginning in approximately 2009, Mendleski operated an enterprise whose principal business was selling personal information—including names, phone numbers and addresses—to telemarketers. Mendleski allegedly specialized in providing in “sweepstakes leads,” which are the phone numbers and personal information of individuals who have responded to mass mailings notifying recipients that they have purportedly won or are about to win, expensive prizes and enormous cash payouts.
The indictment alleges that many of Mendleski’s clients provided information indicating that they intended to use the sweepstakes leads to defraud people; at least one client told Mendleski directly that he intended to engage in fraud. Nonetheless, Mendleski sold the requested personal information to his clients, knowing they would use the information to victimize vulnerable individuals.
Over the course of the scheme, Mendleski allegedly earned approximately $2 million by selling personal information to scammers. Many of the senior citizens identified by Mendleski were in fact subsequently defrauded.
An indictment is merely an allegation and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The FBI is investigating this matter. Trial Attorney Timothy A. Duree of the Criminal Division’s Fraud Section is prosecuting the case.
Federal Law Enforcement Officials to Hold Public Community Policing ConversationsRead the Press Release
BIRMINGHAM – The U.S. Attorney’s Office, FBI and U.S. Marshal Service will hold community policing discussion sessions for the public in Birmingham and Huntsville next week as part of the Justice Department’s National Community Policing Week.
First Assistant U.S. Attorney Robert O. Posey, FBI Special Agent in Charge Roger C. Stanton and U.S. Marshal Martin C. Keely will be available Monday night, Oct. 3, in Birmingham, and Thursday night, Oct. 6, in Huntsville, for “A Community Conversation Addressing Police and Community Relations.”
The meetings will provide community members an opportunity to meet the panelists, learn the roles their agencies have in the justice system, and ask them questions on issues of public safety and community policing.
Monday’s Community Conversation will be from 6 p.m. to 8 p.m. in the Arrington Auditorium of the Birmingham Public Library, 2100 Park Place.
Thursday’s meeting will be from 6 p.m. to 8 p.m. in the Student Services Building Welcome Center Theater on the University of Alabama in Huntsville campus, 1201 John Wright Dr.
The meetings are free and open to the public. For more information contact Phillip Howard at [email protected].
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Federal Jury Finds Naples Man Guilty in Connection with “PIP” Scheme to Defraud Automobile Insurance CompaniesRead the Press Release
Fort Myers, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury has found Nesly Loute (52, Naples) guilty of conspiracy to commit mail fraud. He faces a maximum penalty of 20 years in federal prison. He was ordered detained pending sentencing on January 17, 2017. In addition, Loute must pay restitution to the victim automobile insurance companies and forfeit the proceeds of the offense.
Loute is the sixth individual to be convicted following the culmination of a two-year joint federal and state law enforcement investigation, dubbed Operation Fraudulent Pain. The investigation disrupted five unlicensed chiropractic clinics that had received more than $2 million in ill-gotten Personal Injury Protection (PIP) payments from automobile insurance companies.
According to testimony during the six-day trial, Loute conspired with others to operate unlicensed chiropractic clinics and bill automobile insurance companies for PIP benefits. Members of the conspiracy also paid patients to induce them to seek treatment at the unlicensed clinics so that the automobile insurance companies could be billed for their PIP benefits. In addition, members of the conspiracy participated in staged motor vehicle accidents and then submitted claims to automobile insurance companies for PIP benefits based on those fake accidents. More than $1 million in fraud proceeds were withdrawn from various bank accounts and through the use of a shell corporation.
Five other individuals previously pleaded guilty and are awaiting sentencing as a result of Operation Fraudulent Pain. They are Wisler Cyrius (35, Naples), Anouce Toussaint (33, Naples), Garry Joseph (37, Naples), Maria Victoria Lopez (44, Moore Haven), and David Adamson (47, Bonita Springs). Each faces a maximum penalty of 20 years in federal prison and must make restitution to the automobile insurance companies. In addition, the United States will seek a forfeiture money judgment from each defendant equal to the amount of proceeds obtained as a result of each offense.
This case was investigated by the Fort Myers offices of the Federal Bureau of Investigation, the State of Florida’s Department of Financial Services Division of Insurance Fraud’s, the Internal Revenue Service Criminal Investigation, and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Assistance was also provided by the National Insurance Crime Bureau, the Florida Highway Patrol, the Florida Department of Health, Florida’s Agency for Health Care Administration, and the State Attorneys’ Offices for the 13th and 19th Judicial Circuits. The following insurance companies also assisted with the case: Travelers, Nationwide, Bristol West, Esurance, Windhaven, Farmers, Direct General, Allstate, State Farm, Progressive, Geico, Infinity, and Foremost. It is being prosecuted by Assistant United States Attorneys David G. Lazarus and Charles D. Schmitz.
Federal Jury Finds Gainesville Man Guilty of Conspiring to Distribute More Than Five Kilograms of CocaineRead the Press Release
Ocala, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury found Rodane Lamb (26, Gainesville) guilty of conspiring to distribute five kilograms or more of cocaine. He faces a maximum penalty of life in federal prison. His sentencing hearing is scheduled for December 16, 2016.
Lamb was first indicted on November 20, 2015. That indictment was superseded on March 17, 2016.
According to evidence presented at trial, beginning in 2012, Lamb participated in a conspiracy to distribute more than 50 kilograms of cocaine that had been supplied by the Sinaloa Cartel. Lamb and his co-conspirators, each of whom previously pleaded guilty for their role in the conspiracy, used the United States mail to ship boxes containing hundreds of thousands of dollars in cash to California, which was used to purchase cocaine. The conspirators then used various carriers to ship dozens of kilograms of cocaine back to central Florida, where it was further distributed. The United States Postal Inspection Service confiscated more than $700,000 that had been shipped by the conspirators through the mail.
Testimony further showed that in August 2015, Lamb’s California-based source of cocaine traveled to Florida and directed 50 kilograms of cocaine to be delivered by truck to Ocala, intending that the members of the conspiracy would distribute the cocaine from there. The wholesale value of that cocaine was approximately $1.7 million. The conspirators distributed 10 kilograms of that cocaine. The conspiracy ended on August 5, 2015, when Drug Enforcement Administration agents arrested members of the conspiracy and confiscated the remaining 40 kilograms of cocaine, along with approximately $250,000.
This case was investigated by the Drug Enforcement Administration, the United States Postal Inspection Service, the Internal Revenue Service – Criminal Investigation, the Gainesville Alachua County drug task force, the Ocala Police Department, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the Marion County Sheriff’s Office. It is being prosecuted by Assistant United States Attorneys Jay Taylor and Laura Cofer Taylor.
Federal Indictment Charges Eight with Participating in Doña Ana County Cocaine Trafficking RingRead the Press Release
ALBUQUERQUE – Last week a federal grand jury indicted eight individuals on conspiracy and cocaine trafficking charges based on a DEA-led investigation into a drug trafficking organization that allegedly distributed cocaine in Doña Ana County, N.M. Seven of the eight defendants were arrested today during an early morning law enforcement operation that also included the execution of search warrants at two residences in Las Cruces, N.M., and two residences in Sunland Park, N.M.
The indictment and arrests were announced by U.S. Attorney Damon P. Martinez and Special Agent in Charge Will R. Glaspy of DEA’s El Paso Division.
The 18-count indictment is the result of a six-month investigation, which was designated as part of the Organized Crime Drug Enforcement Task Forces (OCDETF) program, targeting a drug trafficking organization allegedly led by Joel Ibarra-Torres, 46, a Mexican national, that allegedly distributed cocaine in Doña Ana County. Ibarra-Torres has yet to be arrested and is considered a fugitive.
The indictment alleges that Ibarra-Torres and seven co-conspirators, including several members of Ibarra-Torres’ family, participated in a cocaine trafficking conspiracy that existed from at least March 31, 2016 until Sept. 20, 2016. The indictment also alleges that Ibarra-Torres and two of his co-defendants participated in an international money laundering conspiracy. It also charges certain of the defendants with substantive cocaine trafficking offenses and with using telephones to facilitate their drug trafficking activity. The indictment includes forfeiture provisions that seek the forfeiture of at least $31,620, constituting proceeds of the defendants’ alleged criminal activities, to the United States.
Initial appearances, which will be held at the federal courthouse in Las Cruces, for the seven defendants arrested today have yet to be scheduled.
The investigation leading to the indictment was conducted by the Las Cruces office of the DEA, the U.S. Border Patrol and the FBI. The U.S. Marshals Service, Homeland Security Investigations, National Guard, Sunland Park Police Department, New Mexico State Police and the Las Cruces Police Department participated in today’s law enforcement operation. The case is being prosecuted by Assistant U.S. Attorneys Terri J. Abernathy and Sarah M. Davenport of the U.S. Attorney’s Las Cruces Branch office.
Indictment in United States v. Joel Ibarra-Torres, et al. 16-CR-3796
Summary of the Charges
Count 1 of the Indictment charges the eight defendants with participating in a cocaine trafficking conspiracy in Doña Ana County and elsewhere from at least March 31, 2016 through Sept. 20, 2016. The statutory penalty for a conviction on this count is imprisonment for not less than five years and not more than 40 years.
Count 2 charges three defendants with participating in a money laundering conspiracy in Doña Ana County from at least June 15, 2016 through Sept. 20, 2016. The maximum statutory penalty for a conviction on this count is 20 years.
Count 3, 5 and 8 charge certain defendants with distributing cocaine in Doña Ana County on June 9, 2016, July 14, 2016, and Aug. 25, 2016. The maximum statutory penalty for a conviction on each of these counts is imprisonment for 20 years.
Counts 4, 6, 7 and 9 charge certain defendants with possession of cocaine with intent to distribute in Doña Ana County on July 14, 2016, Aug. 25, 2016 and Aug. 26, 2016. The maximum statutory penalty for a conviction on each of these counts is imprisonment for not less than five years and not more than 40 years.
Counts 10 through 18 charge certain defendants with using a communication facility, a telephone, in furtherance of a drug trafficking crime in Doña Ana County on June 29, 2016, July 13, 2016, July 14, 2016, July 15, 2016, July 25, 2016 and July 31, 2016. The maximum statutory penalty for a conviction on each of these counts is imprisonment for four years.
Defendants Charged in Indictment
- Joel Ibarra-Torres, 46, a Mexican national, is charged in Counts 1, 2, 12, 16, and 18. Ibarra-Torres has yet to be arrested and is considered a fugitive.
- Noemi Ibarra, 23, of Las Cruces, N.M., is charged in Counts 1, 2, 6, 11, 13, 15, 16, and 18.
- Joel Ibarra, Jr., 21, of Sunland Park, N.M., is charged in Counts 1, 2, 6 and 13.
- Juan Velazquez, 26, of Las Cruces, is charged in Counts 1, 3- 5, 7-12, 14, 15 and 17.
- Alejandro Chavez, 27, of Las Cruces, is charged in Counts 1, 9, 10 and 17.
- Rene Cruz-Vargas, 40 a Mexican national, is charged in Counts 1, 4, 7 and 14.
- Denise Duarte, 24, of Sunland Park, is charged in Count 1.
- Gabriela Castro, 24, a legal permanent resident from El Paso, Texas, is charged in Count 1.
Charges in indictments are merely accusations and defendants are presumed innocent unless found guilty beyond a reasonable doubt.
Dothan Man Pleads Guilty to Federal Crime Stemming from Involvement in Fraudulent Sales of Iraqi CurrencyRead the Press Release
Montgomery, Ala. – Theodore Stanley Hudson, II, 52, a Dothan, Alabama resident, pleaded guilty Tuesday to a misdemeanor offense resulting from his involvement in a fraudulent scheme to sell Iraqi currency, announced United States Attorney George L. Beck, Jr. and Joseph P. Borg, Director of the Alabama Securities Commission.
According to court documents, an Illinois man, Husam Usama Tayeh, operated a website to fraudulently sell dinar, the official currency of Iraq. Hudson assisted Tayeh in the operation of the fraudulent dinar business. To carry out the scheme, the business’s website misused the seal of the United States Treasury. Hudson pleaded guilty to the specific offense of aiding and abetting the unauthorized use of a government seal. In total, the fraudulent dinar business received over $50 million dollars from purchasers all over the country in return for Iraqi currency.
Hudson is scheduled to be sentenced in January of 2017 where he faces a maximum sentence of one year in prison, as well as a fine.
“The perpetrators of this scheme induced individuals from all of the country to give up their hard earned American dollars for nearly worthless Iraqi currency,” stated United States Attorney Beck. “This case demonstrates that my office is committed to prosecuting each and every person responsible for carrying out this fraud.”
“We are proud of the work of the FBI and the United States Attorney for the Middle District of Alabama and honored to once again partner with them to help stop deceptive practices by persons determined to harm capital markets using misleading tactics to lure investors into no- win schemes,” stated Alabama Securities Commission Director Borg.
The case was investigated by the FBI and the Alabama Securities Commission. Assistant U.S. Attorneys Jonathan S. Ross and Kevin P. Davidson are prosecuting the case, along with Steven P. Feaga, Deputy Director of the Alabama Securities Commission for Enforcement and Prosecution, and Amanda W. Senn, General Counsel of the Alabama Securities Commission.
Corpus Christi Resident Sentenced in Laredo for Marijuana DistributionRead the Press Release
LAREDO, Texas – A 47-year-old Corpus Christi man has been sentenced in Laredo federal court following his conviction of possession with the intent to distribute 1,000 kilograms or more of marijuana and possession of a firearm in furtherance of a drug crime, announced U.S. Attorney Kenneth Magidson. A federal Jury convicted Michael Taylor on May 4, 2016, following a three-day trial.
Today, U.S. District Judge George P. Kazen handed Taylor a 180-month sentence to be immediately followed by five years of supervised release. He was further ordered to complete 200 hours of community service in lieu of a fine.
At trial, the government presented evidence that on Aug. 31, 2015, Taylor attempted to smuggle a load of marijuana in a pickup truck through a ranch located east of Laredo near Bruni. After Border Patrol (BP) agents attempted to stop Taylor, he led them on a four-mile high-speed chase along Highway 359 before turning off the highway and into the brush outside of Hebbronville. He travelled approximately 150 yards before abandoning the vehicle and absconding on foot.
Border Patrol reached the truck but it was engulfed in flames within minutes. They contacted the Hebbronville Volunteer Fire Department who extinguished the fire that was beginning to spread into the surrounding brush.
Meanwhile, BP agents tracked Taylor through the brush with the assistance of BP’s Air Operations. They eventually found him approximately 100 yards from the pickup truck hiding in the brush. At the time of his arrest, agents also discovered a loaded Ruger handgun in his back pocket.
Taylor will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
BP and the Drug Enforcement Administration investigated. Assistant U.S. Attorney Christopher S. Coker and Michael Bukiewics prosecuted the case.
Convicted Sex Offender Sentenced to More Than 13 years in Prison for His Role in the Distribution of Images of a Three-Year-Old ChildRead the Press Release
Assistant U.S. Attorney Alessandra Serano (619) 546-8104
NEWS RELEASE SUMMARY – September 30, 2016
SAN DIEGO, CA – Antonio Glen Boleware, a 39-year-old convicted sex offender and former Marine, was sentenced in federal court today to 158 months in prison for child pornography-related offenses.
According to statements made in court, Boleware was communicating with his girlfriend, 44-year-old Joanna Olson, of Washington State, who was taking illicit photos of a three-year old girl and sending them to Boleware. Boleware was distributing those images and other illicit images to other individuals using an online texting application.
Olson, who pleaded guilty to distribution of child pornography, was sentenced in July to five years in prison for her role in the child pornography exchange. The prosecutor in that case in federal court in Washington state wrote in court papers that the abuse has had a devastating impact on the child.
Boleware was previously convicted of lewd and lascivious acts with a minor under 14 years in 2004.
During Boleware’s sentencing hearing, U.S. District Judge Gonzalo P. Curiel stated that Boleware’s distribution of the photos “magnified the seriousness of the offense” because “the material is on the internet forever, available to predators.”
Before the sentence was handed down, Assistant U.S. Attorney Alessandra Serano urged Judge Curiel to impose the maximum 20-year prison term given Boleware’s “continued involvement in the exploitation of minors over several years.”
In this case, Boleware pleaded guilty in October 2015, admitting to possession of child pornography with a prior sex offense conviction.
“This defendant has continually victimized children who are unable to protect themselves,” said U.S. Attorney Laura Duffy. “There is no higher priority than protecting children from predators like Mr. Boleware.”
DEFENDANT Criminal Case No. 15CR2462-GPS
Antonio Glen Boleware Age: 39 San Diego
SUMMARY OF CHARGES
Possession of Child Pornography with a Prior Sex Offense, in violation of 18 U.S.C. §2252(a)(2)
Maximum Penalties: Twenty years in prison, mandatory minimum 10 years
INVESTIGATING AGENCY
Federal Bureau of Investigation
Conspirators Sentenced to Federal Prison for Identity Theft SchemeRead the Press Release
Baltimore, Maryland – U.S. District Judge James K. Bredar sentenced Shivani Patel, age 30, of Reisterstown, Maryland, to three years in prison, followed by five years of supervised release, and sentenced co-defendant Eddie Carey, age 32, of Baltimore, and two years in prison, followed by three years of supervised release, for their roles in a bank fraud scheme which used the PII and credit information of over 200 victims to fraudulently obtain credit. Judge Bredar also entered an order requiring Patel and Carey each to pay restitution of $61,030.78.
The sentences were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Special Agent in Charge Brian Murphy of the United States Secret Service - Baltimore Field Office; and Chief James Johnson of the Baltimore County Police Department.
According to their plea agreements and court documents, from at least June to December 18, 2013, Patel and her then boyfriend Carey conspired with Tariq Hicks and others to defraud financial institutions by accessing stolen credit card and debit card accounts belonging to real people and using counterfeit cards encoded with the stolen account information to make unauthorized purchases.
Hicks purchased the stolen account information over the internet. Patel and Hicks used a computer and an electronic device to encode the stolen credit and debit card information onto existing credit cards, gift cards, or other similar cards, which were sold or distributed to co-conspirators, such as Carey. The co-conspirators used the cards and provided the bulk of the proceeds to Hicks. Patel often delivered cards to the individuals who were conducting transactions, and recruited workers.
Hicks also purchased or obtained over the internet “credit profiles” containing the identity information of victims, then obtained full credit reports for these victims. Hicks gave this information to Patel, Cary and others, who went into stores where the victims had existing credit accounts, and used the victim’s PII to make purchases on the existing accounts (called “account takeover”). In addition, Hicks used the credit reports to identify stores at which a victim did not have an account, and sent Patel, Carey and others into those stores with the same PII to apply for new credit accounts in the victim’s identity. They then use that “instant credit” to make purchases before the victim learned of the account.
For all of these schemes, Hicks obtained fraudulent drivers’ licenses which bore the information of the victim, but the photograph of a co-conspirator. Patel had many such identifications which bore her photo but the identity information of victims. The co-conspirators could use the counterfeit license and the victims’ PII to establish their identity as the victim. Patel and others instructed those using the cards and information to travel to other states to engage in the fraud. Patel and Carey and other co-conspirators frequently traveled north to Pennsylvania and south as far as Georgia to engage in fraud, as well as the states that lie between Baltimore and Atlanta, including North and South Carolina, West Virginia, and Virginia.
Carey assisted Hicks by conducting wire transfers of money in payment for the stolen credit card numbers and personal profiles. Carey always used a victim identity, provided by Hicks, to wire the money, usually between $2,000 and $3,000, to an individual in the Ukraine. As one of the few men participating in the conspiracy, Carey was often involved in the exploitation of any male victim’s identity and account information. He used the counterfeit cards both to purchase merchandise and to rent cars for use by members of the conspiracy.
On December 18, 2013, a search warrant was executed at Patel, Carey, and Hicks’ residence. A complete set up for the fraud scheme was on the dining table, including a computer with the credit profiles and credit reports, credit cards in various states of manufacture, money gram receipts for payments for the stolen credit card numbers and profiles, lists of personal identity information, dozens of credit cards bearing victims’ names and accounts, as well as dozens of fraudulent identification to match the credit cards, all bearing the information of the victims but the photographs of co-conspirators.
In a basement space shared by Patel and Carey were more lists of victim information and a receipt for a storage locker rented to “Aishwarya Gupta,” a fictitious identity that Patel created as an alter ego and used to obtain a $42,073.22 loan for the purchase of a 2010 BMW 528XI. There was also a small notebook in Patel’s handwriting with the PII of numerous individuals; notations as to money grams which had to be sent to individuals in Kiev and the amounts owed; and other information related to the scheme.
Judge Bredar previously sentenced Tariq Hicks, age 48, of Owings Mills, Maryland, to 65 months in prison, and sentenced co-defendant Ishia Cason, age 36, of Baltimore, to 42 months in prison. Judge Bredar also ordered Hicks to forfeit the credit and identification card counterfeiting equipment seized during the investigation and ordered Hicks and Cason to pay restitution of $61,030.78.
The Maryland Identity Theft Working Group has been working since 2006 to foster cooperation among local, state, federal, and institutional fraud investigators and to promote effective prosecution of identity theft schemes by both state and federal prosecutors. This case, as well as other cases brought by members of the Working Group, demonstrates the commitment of law enforcement agencies to work with financial institutions and businesses to address identity fraud, identify those who compromise personal identity information, and protect citizens from identity theft.
Today’s announcement is part of the efforts undertaken in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’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. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
United States Attorney Rod J. Rosenstein commended HSI-Baltimore, the U.S. Secret Service, and Baltimore County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Tamera L. Fine, who prosecuted the case.
Cocoa Man Convicted of Sex Trafficking of A Child and Production of Child PornographyRead the Press Release
Orlando, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury found Kennedy Harris, Jr., (23, Cocoa) guilty of sex trafficking of a child, with force, fraud, or coercion, and production of child pornography. He faces a maximum penalty of life in federal prison. His sentencing hearing is scheduled for December 19, 2016. Harris was indicted on May 11, 2016.
According to testimony and evidence presented at trial, in January 2016, Harris took in the victim, a 16-year old girl at the time, after she ran away from home. Harris then took sexually suggestive photographs of the victim and advertised her for sex on Backpage.com. He also enticed the victim to engage in sexually explicit conduct for the purpose of photographing her. Over the course of approximately two weeks, the victim had sex with up to eight individuals per day, and gave the money to Harris. In exchange for her sex acts, Harris gave the victim crack cocaine nearly every day. On February 10, 2016, the victim was recovered by the Cocoa Police Department.
This case was investigated by Federal Bureau of Investigation, the Brevard County Sheriff’s Office, and the Cocoa Police Department. It is being prosecuted by Assistant United States Attorney Tiffany L. Cummins.
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 United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Chief Executive Officer of Pharmaceutical Company Charged in $100 Million Fraud SchemeRead the Press Release
Scheme Caused the Collapse and Failure of One of Puerto Rico’s Largest Banks
The former chairman and CEO of a multinational pharmaceutical company was charged in an indictment unsealed today in connection with a fraud scheme that caused over $100 million in losses and led to the collapse and failure of Westernbank Puerto Rico (Westernbank), once one of Puerto Rico’s largest banks.
U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Rosa Emilia Rodriguez-Vélez of the District of Puerto Rico, Acting Inspector General Fred W. Gibson of the Federal Deposit Insurance Corporation’s Office of Inspector General (FDIC-OIG), Special Agent in Charge Kelly R. Jackson of the Internal Revenue Service-Criminal Investigation (IRS-CI) Miami Field Office, Acting Special Agent in Charge Ricardo Mayoral of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) San Juan and Special Agent in Charge Douglas A. Leff of the FBI’s San Juan Division made the announcement.
Jack Kachkar, 53, of Key Biscayne, Florida, was charged with eight counts of wire fraud in an indictment filed on Aug. 4, 2016, in the Southern District of Florida. Kachkar was arrested and made his initial appearance today.
According to the indictment, from 2005 to 2007, Kachkar served as chairman and CEO of Inyx Inc., which was publicly traded on the Nasdaq Over-the-Counter Bulletin Board. Beginning in early 2005, Kachkar and others allegedly caused Westernbank to enter into a series of agreements to provide loans and lines of credit to Inyx and its subsidiaries in exchange for a security interest in the assets of Inyx and its subsidiaries.
The indictment alleges that Kachkar caused false and fraudulent customer invoices to be submitted as collateral for loans from Westernbank; made false and fraudulent representations to Westernbank executives about purported imminent repayments of the Inyx loans and the value of assets he pledged as a guarantee for these loans; and misappropriated and embezzled the fraud proceeds for his personal use and benefit. During the course of the scheme, Kachkar allegedly misappropriated approximately $25 million in fraudulent proceeds to his personal bank accounts and also misappropriated an additional $9.6 million in fraudulent proceeds to a bank account in the name of his associate. Kachkar also allegedly used the proceeds from the scheme to pay for, among other things, multiple high-end real estate properties in Miami, luxury vehicles and a private jet.
The charges and allegations contained in an indictment are merely accusations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The FDIC-OIG, IRS-CI, HSI and FBI investigated the case. Trial Attorney Michael N. Berger and Senior Litigation Counsel John Michelich of the Criminal Division’s Fraud Section are prosecuting the case.
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.
Chief Executive Officer of Pharmaceutical Company Charged in $100 Million Fraud SchemeRead the Press Release
Scheme Caused the Collapse and Failure of One of Puerto Rico’s Largest Banks
The former chairman and CEO of a multinational pharmaceutical company was charged in an indictment unsealed today in connection with a fraud scheme that caused over $100 million in losses and led to the collapse and failure of Westernbank Puerto Rico (Westernbank), once one of Puerto Rico’s largest banks.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, U.S. Attorney Rosa Emilia Rodriguez-Vélez of the District of Puerto Rico, Acting Inspector General Fred W. Gibson of the Federal Deposit Insurance Corporation’s Office of Inspector General (FDIC-OIG), Special Agent in Charge Kelly R. Jackson of the Internal Revenue Service-Criminal Investigation (IRS-CI) Miami Field Office, Acting Special Agent in Charge Ricardo Mayoral of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) San Juan and Special Agent in Charge Douglas A. Leff of the FBI’s San Juan Division made the announcement.
Jack Kachkar, 53, of Key Biscayne, Florida, was charged with eight counts of wire fraud in an indictment filed on Aug. 4, 2016, in the Southern District of Florida. Kachkar was arrested and made his initial appearance today.
According to the indictment, from 2005 to 2007, Kachkar served as chairman and CEO of Inyx Inc., which was publicly traded on the Nasdaq Over-the-Counter Bulletin Board. Beginning in early 2005, Kachkar and others allegedly caused Westernbank to enter into a series of agreements to provide loans and lines of credit to Inyx and its subsidiaries in exchange for a security interest in the assets of Inyx and its subsidiaries.
The indictment alleges that Kachkar caused false and fraudulent customer invoices to be submitted as collateral for loans from Westernbank; made false and fraudulent representations to Westernbank executives about purported imminent repayments of the Inyx loans and the value of assets he pledged as a guarantee for these loans; and misappropriated and embezzled the fraud proceeds for his personal use and benefit. During the course of the scheme, Kachkar allegedly misappropriated approximately $25 million in fraudulent proceeds to his personal bank accounts and also misappropriated an additional $9.6 million in fraudulent proceeds to a bank account in the name of his associate. Kachkar also allegedly used the proceeds from the scheme to pay for, among other things, multiple high-end real estate properties in Miami, luxury vehicles and a private jet.
The charges and allegations contained in an indictment are merely accusations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The FDIC-OIG, IRS-CI, HSI and FBI investigated the case. Trial Attorney Michael N. Berger and Senior Litigation Counsel John Michelich of the Criminal Division’s Fraud Section are prosecuting the case.